Correlation Between Wistron Information and Green World
Can any of the company-specific risk be diversified away by investing in both Wistron Information and Green World 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 Wistron Information and Green World into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wistron Information Technology and Green World Fintech, you can compare the effects of market volatilities on Wistron Information and Green World 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 Wistron Information with a short position of Green World. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wistron Information and Green World.
Diversification Opportunities for Wistron Information and Green World
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Wistron and Green is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Wistron Information Technology and Green World Fintech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Green World Fintech and Wistron Information 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 Wistron Information Technology are associated (or correlated) with Green World. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Green World Fintech has no effect on the direction of Wistron Information i.e., Wistron Information and Green World go up and down completely randomly.
Pair Corralation between Wistron Information and Green World
Assuming the 90 days trading horizon Wistron Information is expected to generate 12.56 times less return on investment than Green World. But when comparing it to its historical volatility, Wistron Information Technology is 1.48 times less risky than Green World. It trades about 0.01 of its potential returns per unit of risk. Green World Fintech is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 3,205 in Green World Fintech on August 27, 2024 and sell it today you would earn a total of 3,765 from holding Green World Fintech or generate 117.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.73% |
| Values | Daily Returns |
Wistron Information Technology vs. Green World Fintech
Performance |
| Timeline |
| Wistron Information |
| Green World Fintech |
Wistron Information and Green World Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wistron Information and Green World
The main advantage of trading using opposite Wistron Information and Green World positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wistron Information position performs unexpectedly, Green World 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 Green World will offset losses from the drop in Green World's long position.| Wistron Information vs. Acer E Enabling Service | Wistron Information vs. Sysage Technology Co | Wistron Information vs. Syscom Computer Engineering | Wistron Information vs. Jetwell Computer Co |
| Green World vs. Acer E Enabling Service | Green World vs. Sysage Technology Co | Green World vs. Syscom Computer Engineering | Green World vs. Jetwell Computer 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Transaction History View history of all your transactions and understand their impact on performance |