Correlation Between Technology Select and DHT Holdings
Can any of the company-specific risk be diversified away by investing in both Technology Select and DHT Holdings 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 Technology Select and DHT Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Technology Select Sector and DHT Holdings, you can compare the effects of market volatilities on Technology Select and DHT Holdings 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 Technology Select with a short position of DHT Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Technology Select and DHT Holdings.
Diversification Opportunities for Technology Select and DHT Holdings
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Technology and DHT is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Technology Select Sector and DHT Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DHT Holdings and Technology Select 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 Technology Select Sector are associated (or correlated) with DHT Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DHT Holdings has no effect on the direction of Technology Select i.e., Technology Select and DHT Holdings go up and down completely randomly.
Pair Corralation between Technology Select and DHT Holdings
Considering the 90-day investment horizon Technology Select is expected to generate 3.7 times less return on investment than DHT Holdings. But when comparing it to its historical volatility, Technology Select Sector is 1.33 times less risky than DHT Holdings. It trades about 0.06 of its potential returns per unit of risk. DHT Holdings is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 1,137 in DHT Holdings on August 23, 2025 and sell it today you would earn a total of 194.00 from holding DHT Holdings or generate 17.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Technology Select Sector vs. DHT Holdings
Performance |
| Timeline |
| Technology Select Sector |
| DHT Holdings |
Technology Select and DHT Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Technology Select and DHT Holdings
The main advantage of trading using opposite Technology Select and DHT Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Technology Select position performs unexpectedly, DHT Holdings 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 DHT Holdings will offset losses from the drop in DHT Holdings' long position.| Technology Select vs. Vanguard High Dividend | Technology Select vs. Vanguard High Dividend | Technology Select vs. Vanguard Extended Market | Technology Select vs. iShares Core SP |
| DHT Holdings vs. Teekay Tankers | DHT Holdings vs. Torm PLC Class | DHT Holdings vs. International Seaways | DHT Holdings vs. Delek Logistics Partners |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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