Correlation Between AMTD Digital and ZW Data

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

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

Diversification Opportunities for AMTD Digital and ZW Data

0.0

Correlation Coefficient

AMTD Digital  ZW Data

Pay attention - limited upside

The 3 months correlation between AMTD and CNET is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding AMTD Digital and ZW Data Action in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ZW Data Action and AMTD Digital 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 AMTD Digital are associated (or correlated) with ZW Data. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ZW Data Action has no effect on the direction of AMTD Digital i.e., AMTD Digital and ZW Data go up and down completely randomly.

Pair Corralation between AMTD Digital and ZW Data

Considering the 90-day investment horizon AMTD Digital is expected to generate 0.75 times more return on investment than ZW Data. However, AMTD Digital is 1.34 times less risky than ZW Data. It trades about -0.03 of its potential returns per unit of risk. ZW Data Action is currently generating about -0.02 per unit of risk. If you would invest  202.00  in AMTD Digital on May 6, 2025 and sell it today you would lose (35.00) from holding AMTD Digital or give up 17.33% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

AMTD Digital  vs.  ZW Data Action

AMTD Digital

Risk-Adjusted Performance

Very Weak

Over the last 90 days AMTD Digital has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's forward-looking signals remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

ZW Data Action

Risk-Adjusted Performance

Very Weak

Over the last 90 days ZW Data Action has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's technical and fundamental indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with AMTD Digital and ZW Data

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

The idea behind AMTD Digital and ZW Data Action 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.