Correlation Between Wisher Industrial and Maywufa
Can any of the company-specific risk be diversified away by investing in both Wisher Industrial and Maywufa 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 Wisher Industrial and Maywufa into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wisher Industrial Co and Maywufa Co, you can compare the effects of market volatilities on Wisher Industrial and Maywufa 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 Wisher Industrial with a short position of Maywufa. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wisher Industrial and Maywufa.
Diversification Opportunities for Wisher Industrial and Maywufa
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Wisher and Maywufa is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Wisher Industrial Co and Maywufa Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Maywufa and Wisher Industrial 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 Wisher Industrial Co are associated (or correlated) with Maywufa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Maywufa has no effect on the direction of Wisher Industrial i.e., Wisher Industrial and Maywufa go up and down completely randomly.
Pair Corralation between Wisher Industrial and Maywufa
Assuming the 90 days trading horizon Wisher Industrial Co is expected to generate 0.69 times more return on investment than Maywufa. However, Wisher Industrial Co is 1.45 times less risky than Maywufa. It trades about -0.03 of its potential returns per unit of risk. Maywufa Co is currently generating about -0.13 per unit of risk. If you would invest 1,445 in Wisher Industrial Co on January 17, 2025 and sell it today you would lose (30.00) from holding Wisher Industrial Co or give up 2.08% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wisher Industrial Co vs. Maywufa Co
Performance |
| Timeline |
| Wisher Industrial |
| Maywufa |
Wisher Industrial and Maywufa Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wisher Industrial and Maywufa
The main advantage of trading using opposite Wisher Industrial and Maywufa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wisher Industrial position performs unexpectedly, Maywufa 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 Maywufa will offset losses from the drop in Maywufa's long position.| Wisher Industrial vs. De Licacy Industrial | Wisher Industrial vs. Nien Hsing Textile | Wisher Industrial vs. Tainan Enterprises Co | Wisher Industrial vs. Tex Ray Industrial Co |
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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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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