Correlation Between Doubledown Interactive and Hamilton Insurance

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

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

Diversification Opportunities for Doubledown Interactive and Hamilton Insurance

-0.08

Correlation Coefficient

Doubledown Interactive  Hamilton Insurance

Good diversification

The 3 months correlation between Doubledown and Hamilton is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Doubledown Interactive Co and Hamilton Insurance Group, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hamilton Insurance Group, and Doubledown Interactive 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 Doubledown Interactive Co are associated (or correlated) with Hamilton Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hamilton Insurance Group, has no effect on the direction of Doubledown Interactive i.e., Doubledown Interactive and Hamilton Insurance go up and down completely randomly.

Pair Corralation between Doubledown Interactive and Hamilton Insurance

Considering the 90-day investment horizon Doubledown Interactive Co is expected to generate 2.11 times more return on investment than Hamilton Insurance. However, Doubledown Interactive is 2.11 times more volatile than Hamilton Insurance Group,. It trades about 0.06 of its potential returns per unit of risk. Hamilton Insurance Group, is currently generating about 0.05 per unit of risk. If you would invest  830.00  in Doubledown Interactive Co on September 4, 2024 and sell it today you would earn a total of  502.00  from holding Doubledown Interactive Co or generate 60.48% return on investment over 90 days.

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

Doubledown Interactive Co  vs.  Hamilton Insurance Group,

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 fairly strong fundamental indicators, Doubledown Interactive is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

Hamilton Insurance Group,

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Hamilton Insurance Group, has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable technical and fundamental indicators, Hamilton Insurance is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Doubledown Interactive and Hamilton Insurance

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

The idea behind Doubledown Interactive Co and Hamilton Insurance Group, 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.