Correlation Between Digatrade Financial and Castellum

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

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

Diversification Opportunities for Digatrade Financial and Castellum

0.0

Correlation Coefficient

Digatrade Financial  Castellum

Pay attention - limited upside

The 3 months correlation between Digatrade and Castellum is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Digatrade Financial Corp and Castellum in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Castellum and Digatrade Financial 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 Digatrade Financial Corp are associated (or correlated) with Castellum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Castellum has no effect on the direction of Digatrade Financial i.e., Digatrade Financial and Castellum go up and down completely randomly.

Pair Corralation between Digatrade Financial and Castellum

If you would invest  17.00  in Castellum on September 1, 2024 and sell it today you would earn a total of  3.00  from holding Castellum or generate 17.65% return on investment over 90 days.

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

Digatrade Financial Corp  vs.  Castellum

Digatrade Financial Corp

Risk-Adjusted Performance

0 of 100

Very Weak

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

Castellum

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Castellum are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of very inconsistent basic indicators, Castellum displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Digatrade Financial and Castellum

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

The idea behind Digatrade Financial Corp and Castellum 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.