Correlation Between Digital China and Flint Telecom

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

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

Diversification Opportunities for Digital China and Flint Telecom

0.4

Correlation Coefficient

Digital China  Flint Telecom

Very weak diversification

The 3 months correlation between Digital and Flint is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Digital China Holdings and Flint Telecom Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Flint Telecom Group and Digital China 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 Digital China Holdings are associated (or correlated) with Flint Telecom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Flint Telecom Group has no effect on the direction of Digital China i.e., Digital China and Flint Telecom go up and down completely randomly.

Pair Corralation between Digital China and Flint Telecom

Assuming the 90 days horizon Digital China Holdings is expected to under-perform the Flint Telecom. But the pink sheet apears to be less risky and, when comparing its historical volatility, Digital China Holdings is 12.38 times less risky than Flint Telecom. The pink sheet trades about -0.21 of its potential returns per unit of risk. The Flint Telecom Group is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  90.00  in Flint Telecom Group on September 13, 2025 and sell it today you would lose (58.00) from holding Flint Telecom Group or give up 64.44% of portfolio value over 90 days.

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

Digital China Holdings  vs.  Flint Telecom Group

Digital China Holdings

Risk-Adjusted Performance

Weakest

Over the last 90 days Digital China Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's forward indicators remain nearly stable which may send shares a bit higher in January 2026. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Flint Telecom Group

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Flint Telecom Group are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Even with relatively fragile basic indicators, Flint Telecom reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Digital China and Flint Telecom

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

The idea behind Digital China Holdings and Flint Telecom Group 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.