Correlation Between Dynex Capital and Inception Growth

Can any of the company-specific risk be diversified away by investing in both Dynex Capital and Inception Growth 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 Dynex Capital and Inception Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Dynex Capital and Inception Growth Acquisition, you can compare the effects of market volatilities on Dynex Capital and Inception Growth 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 Dynex Capital with a short position of Inception Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dynex Capital and Inception Growth.

Diversification Opportunities for Dynex Capital and Inception Growth

0.74

Correlation Coefficient

Dynex Capital  Inception Growth

Poor diversification

The 3 months correlation between Dynex and Inception is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Dynex Capital and Inception Growth Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inception Growth Acq and Dynex Capital 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 Dynex Capital are associated (or correlated) with Inception Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inception Growth Acq has no effect on the direction of Dynex Capital i.e., Dynex Capital and Inception Growth go up and down completely randomly.

Pair Corralation between Dynex Capital and Inception Growth

Allowing for the 90-day total investment horizon Dynex Capital is expected to generate 1.63 times less return on investment than Inception Growth. But when comparing it to its historical volatility, Dynex Capital is 1.48 times less risky than Inception Growth. It trades about 0.07 of its potential returns per unit of risk. Inception Growth Acquisition is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  1,169  in Inception Growth Acquisition on September 22, 2024 and sell it today you would earn a total of  70.00  from holding Inception Growth Acquisition or generate 5.99% return on investment over 90 days.

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

Dynex Capital  vs.  Inception Growth Acquisition

Dynex Capital

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Dynex Capital are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong basic indicators, Dynex Capital is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Inception Growth Acq

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Inception Growth Acquisition are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Inception Growth is not utilizing all of its potentials. The recent stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Dynex Capital and Inception Growth

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

The idea behind Dynex Capital and Inception Growth Acquisition 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.