Correlation Between Chenming Mold and Welltend Technology
Can any of the company-specific risk be diversified away by investing in both Chenming Mold and Welltend Technology 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 Chenming Mold and Welltend Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chenming Mold Industrial and Welltend Technology Corp, you can compare the effects of market volatilities on Chenming Mold and Welltend Technology 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 Chenming Mold with a short position of Welltend Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chenming Mold and Welltend Technology.
Diversification Opportunities for Chenming Mold and Welltend Technology
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Chenming and Welltend is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Chenming Mold Industrial and Welltend Technology Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Welltend Technology Corp and Chenming Mold 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 Chenming Mold Industrial are associated (or correlated) with Welltend Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Welltend Technology Corp has no effect on the direction of Chenming Mold i.e., Chenming Mold and Welltend Technology go up and down completely randomly.
Pair Corralation between Chenming Mold and Welltend Technology
Assuming the 90 days trading horizon Chenming Mold Industrial is expected to generate 1.4 times more return on investment than Welltend Technology. However, Chenming Mold is 1.4 times more volatile than Welltend Technology Corp. It trades about 0.1 of its potential returns per unit of risk. Welltend Technology Corp is currently generating about -0.24 per unit of risk. If you would invest 13,400 in Chenming Mold Industrial on October 24, 2024 and sell it today you would earn a total of 800.00 from holding Chenming Mold Industrial or generate 5.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Chenming Mold Industrial vs. Welltend Technology Corp
Performance |
| Timeline |
| Chenming Mold Industrial |
| Welltend Technology Corp |
Chenming Mold and Welltend Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chenming Mold and Welltend Technology
The main advantage of trading using opposite Chenming Mold and Welltend Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chenming Mold position performs unexpectedly, Welltend Technology 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 Welltend Technology will offset losses from the drop in Welltend Technology's long position.| Chenming Mold vs. Clevo Co | Chenming Mold vs. Zinwell | Chenming Mold vs. Min Aik Technology | Chenming Mold vs. Promise Technology |
| Welltend Technology vs. Ji Haw Industrial Co | Welltend Technology vs. Chenming Mold Industrial | Welltend Technology vs. AOPEN Inc | Welltend Technology vs. Asia Optical Co |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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