Correlation Between DoubleVerify Holdings and AMTD Digital

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

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

Diversification Opportunities for DoubleVerify Holdings and AMTD Digital

-0.52

Correlation Coefficient

DoubleVerify Holdings  AMTD Digital

Excellent diversification

The 3 months correlation between DoubleVerify and AMTD is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding DoubleVerify Holdings and AMTD Digital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AMTD Digital and DoubleVerify Holdings 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 DoubleVerify Holdings are associated (or correlated) with AMTD Digital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AMTD Digital has no effect on the direction of DoubleVerify Holdings i.e., DoubleVerify Holdings and AMTD Digital go up and down completely randomly.

Pair Corralation between DoubleVerify Holdings and AMTD Digital

Allowing for the 90-day total investment horizon DoubleVerify Holdings is expected to generate 3.87 times less return on investment than AMTD Digital. But when comparing it to its historical volatility, DoubleVerify Holdings is 3.42 times less risky than AMTD Digital. It trades about 0.05 of its potential returns per unit of risk. AMTD Digital is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  279.00  in AMTD Digital on September 2, 2024 and sell it today you would earn a total of  24.00  from holding AMTD Digital or generate 8.6% return on investment over 90 days.

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

DoubleVerify Holdings  vs.  AMTD Digital

DoubleVerify Holdings

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in DoubleVerify Holdings are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of fairly stable basic indicators, DoubleVerify Holdings is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

AMTD Digital

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in AMTD Digital are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady forward-looking signals, AMTD Digital exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with DoubleVerify Holdings and AMTD Digital

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

The idea behind DoubleVerify Holdings and AMTD Digital 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.