Correlation Between DigiAsia Corp and Xunlei
Can any of the company-specific risk be diversified away by investing in both DigiAsia Corp and Xunlei 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 DigiAsia Corp and Xunlei into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DigiAsia Corp and Xunlei Ltd Adr, you can compare the effects of market volatilities on DigiAsia Corp and Xunlei 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 DigiAsia Corp with a short position of Xunlei. Check out your portfolio center. Please also check ongoing floating volatility patterns of DigiAsia Corp and Xunlei.
Diversification Opportunities for DigiAsia Corp and Xunlei
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between DigiAsia and Xunlei is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding DigiAsia Corp and Xunlei Ltd Adr in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xunlei Ltd Adr and DigiAsia Corp 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 DigiAsia Corp are associated (or correlated) with Xunlei. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xunlei Ltd Adr has no effect on the direction of DigiAsia Corp i.e., DigiAsia Corp and Xunlei go up and down completely randomly.
Pair Corralation between DigiAsia Corp and Xunlei
Assuming the 90 days horizon DigiAsia Corp is expected to generate 4.11 times more return on investment than Xunlei. However, DigiAsia Corp is 4.11 times more volatile than Xunlei Ltd Adr. It trades about 0.09 of its potential returns per unit of risk. Xunlei Ltd Adr is currently generating about 0.1 per unit of risk. If you would invest 7.00 in DigiAsia Corp on March 23, 2025 and sell it today you would lose (0.41) from holding DigiAsia Corp or give up 5.86% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 89.47% |
| Values | Daily Returns |
DigiAsia Corp vs. Xunlei Ltd Adr
Performance |
| Timeline |
| DigiAsia Corp |
| Xunlei Ltd Adr |
DigiAsia Corp and Xunlei Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DigiAsia Corp and Xunlei
The main advantage of trading using opposite DigiAsia Corp and Xunlei positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DigiAsia Corp position performs unexpectedly, Xunlei 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 Xunlei will offset losses from the drop in Xunlei's long position.| DigiAsia Corp vs. Hudson Technologies | DigiAsia Corp vs. Vita Coco | DigiAsia Corp vs. Kite Realty Group | DigiAsia Corp vs. Fomento Economico Mexicano |
| Xunlei vs. Travelzoo | Xunlei vs. Emerald Expositions Events | Xunlei vs. Ziff Davis | Xunlei vs. Direct Digital Holdings |
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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