Correlation Between Dito CME and IRemit

Can any of the company-specific risk be diversified away by investing in both Dito CME and IRemit at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Dito CME and IRemit into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Dito CME Holdings and IRemit Inc, you can compare the effects of market volatilities on Dito CME and IRemit and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Dito CME with a short position of IRemit. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dito CME and IRemit.

Diversification Opportunities for Dito CME and IRemit

0.12

Correlation Coefficient

Dito CME  IRemit

Average diversification

The 3 months correlation between Dito and IRemit is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Dito CME Holdings and IRemit Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IRemit Inc and Dito CME is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Dito CME Holdings are associated (or correlated) with IRemit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IRemit Inc has no effect on the direction of Dito CME i.e., Dito CME and IRemit go up and down completely randomly.

Pair Corralation between Dito CME and IRemit

Assuming the 90 days trading horizon Dito CME Holdings is expected to generate 0.41 times more return on investment than IRemit. However, Dito CME Holdings is 2.41 times less risky than IRemit. It trades about -0.01 of its potential returns per unit of risk. IRemit Inc is currently generating about -0.03 per unit of risk. If you would invest  318.00  in Dito CME Holdings on October 11, 2024 and sell it today you would lose (113.00) from holding Dito CME Holdings or give up 35.53% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	39.25%
Values	Daily Returns

Dito CME Holdings  vs.  IRemit Inc

Dito CME Holdings

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Dito CME Holdings are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Dito CME unveiled solid returns over the last few months and may actually be approaching a breakup point.

IRemit Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days IRemit Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's basic indicators remain rather sound which may send shares a bit higher in February 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Pair Trading with Dito CME and IRemit

The main advantage of trading using opposite Dito CME and IRemit positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dito CME position performs unexpectedly, IRemit can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in IRemit will offset losses from the drop in IRemit's long position.

The idea behind Dito CME Holdings and IRemit Inc pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.