Correlation Between WPG Holdings and Trade Van
Can any of the company-specific risk be diversified away by investing in both WPG Holdings and Trade Van 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 WPG Holdings and Trade Van into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WPG Holdings and Trade Van Information Services, you can compare the effects of market volatilities on WPG Holdings and Trade Van 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 WPG Holdings with a short position of Trade Van. Check out your portfolio center. Please also check ongoing floating volatility patterns of WPG Holdings and Trade Van.
Diversification Opportunities for WPG Holdings and Trade Van
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between WPG and Trade is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding WPG Holdings and Trade Van Information Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trade Van Information and WPG Holdings 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 WPG Holdings are associated (or correlated) with Trade Van. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trade Van Information has no effect on the direction of WPG Holdings i.e., WPG Holdings and Trade Van go up and down completely randomly.
Pair Corralation between WPG Holdings and Trade Van
If you would invest 8,260 in Trade Van Information Services on October 21, 2024 and sell it today you would earn a total of 880.00 from holding Trade Van Information Services or generate 10.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.24% |
| Values | Daily Returns |
WPG Holdings vs. Trade Van Information Services
Performance |
| Timeline |
| WPG Holdings |
| Trade Van Information |
WPG Holdings and Trade Van Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WPG Holdings and Trade Van
The main advantage of trading using opposite WPG Holdings and Trade Van positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WPG Holdings position performs unexpectedly, Trade Van 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 Trade Van will offset losses from the drop in Trade Van's long position.| WPG Holdings vs. GrandTech CG Systems | WPG Holdings vs. Answer Technology Co | WPG Holdings vs. Xander International | WPG Holdings vs. MetaTech AP |
| Trade Van vs. Taiwan Sakura Corp | Trade Van vs. Charoen Pokphand Enterprise | Trade Van vs. Taiwan Cogeneration Corp | Trade Van vs. Taiwan Secom 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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