Correlation Between Dook Media and Road Environment
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By analyzing existing cross correlation between Dook Media Group and Road Environment Technology, you can compare the effects of market volatilities on Dook Media and Road Environment 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 Dook Media with a short position of Road Environment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dook Media and Road Environment.
Diversification Opportunities for Dook Media and Road Environment
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Dook and Road is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Dook Media Group and Road Environment Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Road Environment Tec and Dook Media 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 Dook Media Group are associated (or correlated) with Road Environment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Road Environment Tec has no effect on the direction of Dook Media i.e., Dook Media and Road Environment go up and down completely randomly.
Pair Corralation between Dook Media and Road Environment
Assuming the 90 days trading horizon Dook Media Group is expected to generate 1.2 times more return on investment than Road Environment. However, Dook Media is 1.2 times more volatile than Road Environment Technology. It trades about 0.16 of its potential returns per unit of risk. Road Environment Technology is currently generating about 0.18 per unit of risk. If you would invest 811.00 in Dook Media Group on September 23, 2024 and sell it today you would earn a total of 368.00 from holding Dook Media Group or generate 45.38% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Dook Media Group vs. Road Environment Technology
Performance |
Timeline |
Dook Media Group |
Road Environment Tec |
Dook Media and Road Environment Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Dook Media and Road Environment
The main advantage of trading using opposite Dook Media and Road Environment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dook Media position performs unexpectedly, Road Environment 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 Road Environment will offset losses from the drop in Road Environment's long position.Dook Media vs. PetroChina Co Ltd | Dook Media vs. China Mobile Limited | Dook Media vs. CNOOC Limited | Dook Media vs. Ping An Insurance |
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Check out your portfolio center.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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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