Correlation Between 62886EAY4 and Doubledown Interactive

Can any of the company-specific risk be diversified away by investing in both 62886EAY4 and Doubledown Interactive 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 62886EAY4 and Doubledown Interactive into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between NCR P NEW and Doubledown Interactive Co, you can compare the effects of market volatilities on 62886EAY4 and Doubledown Interactive 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 62886EAY4 with a short position of Doubledown Interactive. Check out your portfolio center. Please also check ongoing floating volatility patterns of 62886EAY4 and Doubledown Interactive.

Diversification Opportunities for 62886EAY4 and Doubledown Interactive

0.19

Correlation Coefficient

62886EAY4  Doubledown Interactive

Average diversification

The 3 months correlation between 62886EAY4 and Doubledown is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding NCR P NEW and Doubledown Interactive Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Doubledown Interactive and 62886EAY4 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 NCR P NEW are associated (or correlated) with Doubledown Interactive. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Doubledown Interactive has no effect on the direction of 62886EAY4 i.e., 62886EAY4 and Doubledown Interactive go up and down completely randomly.

Pair Corralation between 62886EAY4 and Doubledown Interactive

Assuming the 90 days trading horizon NCR P NEW is expected to generate 0.16 times more return on investment than Doubledown Interactive. However, NCR P NEW is 6.34 times less risky than Doubledown Interactive. It trades about 0.1 of its potential returns per unit of risk. Doubledown Interactive Co is currently generating about -0.11 per unit of risk. If you would invest  9,700  in NCR P NEW on October 9, 2024 and sell it today you would earn a total of  278.00  from holding NCR P NEW or generate 2.87% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	91.8%
Values	Daily Returns

NCR P NEW  vs.  Doubledown Interactive Co

NCR P NEW

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in NCR P NEW are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, 62886EAY4 is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Doubledown Interactive

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Doubledown Interactive Co has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Stock's fundamental indicators remain fairly strong which may send shares a bit higher in February 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Pair Trading with 62886EAY4 and Doubledown Interactive

The main advantage of trading using opposite 62886EAY4 and Doubledown Interactive positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 62886EAY4 position performs unexpectedly, Doubledown Interactive 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 Doubledown Interactive will offset losses from the drop in Doubledown Interactive's long position.

The idea behind NCR P NEW and Doubledown Interactive Co 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.