Correlation Between Wisdom Marine and U Ming
Can any of the company-specific risk be diversified away by investing in both Wisdom Marine and U Ming 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 Wisdom Marine and U Ming into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wisdom Marine Lines and U Ming Marine Transport, you can compare the effects of market volatilities on Wisdom Marine and U Ming 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 Wisdom Marine with a short position of U Ming. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wisdom Marine and U Ming.
Diversification Opportunities for Wisdom Marine and U Ming
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Wisdom and 2606 is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Wisdom Marine Lines and U Ming Marine Transport in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on U Ming Marine and Wisdom Marine 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 Wisdom Marine Lines are associated (or correlated) with U Ming. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of U Ming Marine has no effect on the direction of Wisdom Marine i.e., Wisdom Marine and U Ming go up and down completely randomly.
Pair Corralation between Wisdom Marine and U Ming
Assuming the 90 days trading horizon Wisdom Marine is expected to generate 1.81 times less return on investment than U Ming. In addition to that, Wisdom Marine is 1.26 times more volatile than U Ming Marine Transport. It trades about 0.19 of its total potential returns per unit of risk. U Ming Marine Transport is currently generating about 0.43 per unit of volatility. If you would invest 5,520 in U Ming Marine Transport on August 28, 2024 and sell it today you would earn a total of 590.00 from holding U Ming Marine Transport or generate 10.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wisdom Marine Lines vs. U Ming Marine Transport
Performance |
| Timeline |
| Wisdom Marine Lines |
| U Ming Marine |
Wisdom Marine and U Ming Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wisdom Marine and U Ming
The main advantage of trading using opposite Wisdom Marine and U Ming positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wisdom Marine position performs unexpectedly, U Ming 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 U Ming will offset losses from the drop in U Ming's long position.| Wisdom Marine vs. U Ming Marine Transport | Wisdom Marine vs. Wan Hai Lines | Wisdom Marine vs. Yang Ming Marine | Wisdom Marine vs. Shih Wei Navigation |
| U Ming vs. Sunny Friend Environmental | U Ming vs. TTET Union Corp | U Ming vs. ECOVE Environment Corp | U Ming vs. Yulon Finance Corp |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
Other Complementary Tools
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios |