Correlation Between Digimarc and SavMobi Technology

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

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

Diversification Opportunities for Digimarc and SavMobi Technology

-0.51

Correlation Coefficient

Digimarc  SavMobi Technology

Excellent diversification

The 3 months correlation between Digimarc and SavMobi is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Digimarc and SavMobi Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SavMobi Technology and Digimarc 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 Digimarc are associated (or correlated) with SavMobi Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SavMobi Technology has no effect on the direction of Digimarc i.e., Digimarc and SavMobi Technology go up and down completely randomly.

Pair Corralation between Digimarc and SavMobi Technology

Given the investment horizon of 90 days Digimarc is expected to generate 3.49 times less return on investment than SavMobi Technology. But when comparing it to its historical volatility, Digimarc is 4.43 times less risky than SavMobi Technology. It trades about 0.2 of its potential returns per unit of risk. SavMobi Technology is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest  200.00  in SavMobi Technology on September 30, 2024 and sell it today you would earn a total of  63.00  from holding SavMobi Technology or generate 31.5% return on investment over 90 days.

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

Digimarc  vs.  SavMobi Technology

Digimarc

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Digimarc are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of rather unfluctuating basic indicators, Digimarc exhibited solid returns over the last few months and may actually be approaching a breakup point.

SavMobi Technology

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SavMobi Technology has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong primary indicators, SavMobi Technology is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Digimarc and SavMobi Technology

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

The idea behind Digimarc and SavMobi Technology 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.