Correlation Between Western Metal and UE Furniture
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By analyzing existing cross correlation between Western Metal Materials and UE Furniture Co, you can compare the effects of market volatilities on Western Metal and UE Furniture 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 Western Metal with a short position of UE Furniture. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western Metal and UE Furniture.
Diversification Opportunities for Western Metal and UE Furniture
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Western and 603600 is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Western Metal Materials and UE Furniture Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UE Furniture and Western Metal 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 Western Metal Materials are associated (or correlated) with UE Furniture. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UE Furniture has no effect on the direction of Western Metal i.e., Western Metal and UE Furniture go up and down completely randomly.
Pair Corralation between Western Metal and UE Furniture
Assuming the 90 days trading horizon Western Metal Materials is expected to generate 1.54 times more return on investment than UE Furniture. However, Western Metal is 1.54 times more volatile than UE Furniture Co. It trades about 0.24 of its potential returns per unit of risk. UE Furniture Co is currently generating about -0.25 per unit of risk. If you would invest 1,700 in Western Metal Materials on November 27, 2024 and sell it today you would earn a total of 210.00 from holding Western Metal Materials or generate 12.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Western Metal Materials vs. UE Furniture Co
Performance |
| Timeline |
| Western Metal Materials |
| UE Furniture |
Western Metal and UE Furniture Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Western Metal and UE Furniture
The main advantage of trading using opposite Western Metal and UE Furniture positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Western Metal position performs unexpectedly, UE Furniture 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 UE Furniture will offset losses from the drop in UE Furniture's long position.| Western Metal vs. Peoples Insurance of | Western Metal vs. Guangzhou Shangpin Home | Western Metal vs. Arrow Home Group | Western Metal vs. Mengtian Home Group |
| UE Furniture vs. Aofu Environmental Technology | UE Furniture vs. Tongxing Environmental Protection | UE Furniture vs. JCHX Mining Management | UE Furniture vs. Eit Environmental Development |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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