Correlation Between DoubleVerify Holdings and CoreCard Corp

Can any of the company-specific risk be diversified away by investing in both DoubleVerify Holdings and CoreCard Corp 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 DoubleVerify Holdings and CoreCard Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between DoubleVerify Holdings and CoreCard Corp, you can compare the effects of market volatilities on DoubleVerify Holdings and CoreCard Corp 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 DoubleVerify Holdings with a short position of CoreCard Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of DoubleVerify Holdings and CoreCard Corp.

Diversification Opportunities for DoubleVerify Holdings and CoreCard Corp

0.18

Correlation Coefficient

DoubleVerify Holdings  CoreCard Corp

Average diversification

The 3 months correlation between DoubleVerify and CoreCard is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding DoubleVerify Holdings and CoreCard Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CoreCard Corp and DoubleVerify Holdings 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 DoubleVerify Holdings are associated (or correlated) with CoreCard Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CoreCard Corp has no effect on the direction of DoubleVerify Holdings i.e., DoubleVerify Holdings and CoreCard Corp go up and down completely randomly.

Pair Corralation between DoubleVerify Holdings and CoreCard Corp

Allowing for the 90-day total investment horizon DoubleVerify Holdings is expected to generate 0.6 times more return on investment than CoreCard Corp. However, DoubleVerify Holdings is 1.68 times less risky than CoreCard Corp. It trades about 0.07 of its potential returns per unit of risk. CoreCard Corp is currently generating about 0.02 per unit of risk. If you would invest  2,033  in DoubleVerify Holdings on November 29, 2024 and sell it today you would earn a total of  126.00  from holding DoubleVerify Holdings or generate 6.2% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

DoubleVerify Holdings  vs.  CoreCard Corp

DoubleVerify Holdings

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in DoubleVerify Holdings are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of fairly conflicting basic indicators, DoubleVerify Holdings may actually be approaching a critical reversion point that can send shares even higher in March 2025.

CoreCard Corp

Risk-Adjusted Performance

Very Weak

Compared to the overall equity markets, risk-adjusted returns on investments in CoreCard Corp are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, CoreCard Corp is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with DoubleVerify Holdings and CoreCard Corp

The main advantage of trading using opposite DoubleVerify Holdings and CoreCard Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DoubleVerify Holdings position performs unexpectedly, CoreCard Corp 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 CoreCard Corp will offset losses from the drop in CoreCard Corp's long position.

The idea behind DoubleVerify Holdings and CoreCard Corp 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.