Correlation Between Western Mining and IRay Technology
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By analyzing existing cross correlation between Western Mining Co and iRay Technology Co, you can compare the effects of market volatilities on Western Mining and IRay 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 Western Mining with a short position of IRay Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western Mining and IRay Technology.
Diversification Opportunities for Western Mining and IRay Technology
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Western and IRay is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Western Mining Co and iRay Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iRay Technology and Western Mining 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 Western Mining Co are associated (or correlated) with IRay Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iRay Technology has no effect on the direction of Western Mining i.e., Western Mining and IRay Technology go up and down completely randomly.
Pair Corralation between Western Mining and IRay Technology
Assuming the 90 days trading horizon Western Mining Co is expected to generate 0.68 times more return on investment than IRay Technology. However, Western Mining Co is 1.47 times less risky than IRay Technology. It trades about 0.06 of its potential returns per unit of risk. iRay Technology Co is currently generating about -0.02 per unit of risk. If you would invest 964.00 in Western Mining Co on September 3, 2024 and sell it today you would earn a total of 720.00 from holding Western Mining Co or generate 74.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Western Mining Co vs. iRay Technology Co
Performance |
| Timeline |
| Western Mining |
| iRay Technology |
Western Mining and IRay Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Western Mining and IRay Technology
The main advantage of trading using opposite Western Mining and IRay Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Western Mining position performs unexpectedly, IRay 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 IRay Technology will offset losses from the drop in IRay Technology's long position.| Western Mining vs. Zijin Mining Group | Western Mining vs. Baoshan Iron Steel | Western Mining vs. Rongsheng Petrochemical Co | Western Mining vs. Hoshine Silicon Ind |
| IRay Technology vs. Sichuan Hebang Biotechnology | IRay Technology vs. Yili Chuanning Biotechnology | IRay Technology vs. Guangdong Marubi Biotechnology | IRay Technology vs. Western Mining 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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