Correlation Between WIMFARM SA and ZhongAn Online
Can any of the company-specific risk be diversified away by investing in both WIMFARM SA and ZhongAn Online 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 WIMFARM SA and ZhongAn Online into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WIMFARM SA EO and ZhongAn Online P, you can compare the effects of market volatilities on WIMFARM SA and ZhongAn Online 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 WIMFARM SA with a short position of ZhongAn Online. Check out your portfolio center. Please also check ongoing floating volatility patterns of WIMFARM SA and ZhongAn Online.
Diversification Opportunities for WIMFARM SA and ZhongAn Online
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between WIMFARM and ZhongAn is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding WIMFARM SA EO and ZhongAn Online P in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ZhongAn Online P and WIMFARM SA 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 WIMFARM SA EO are associated (or correlated) with ZhongAn Online. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ZhongAn Online P has no effect on the direction of WIMFARM SA i.e., WIMFARM SA and ZhongAn Online go up and down completely randomly.
Pair Corralation between WIMFARM SA and ZhongAn Online
Assuming the 90 days horizon WIMFARM SA EO is expected to generate 1.01 times more return on investment than ZhongAn Online. However, WIMFARM SA is 1.01 times more volatile than ZhongAn Online P. It trades about -0.01 of its potential returns per unit of risk. ZhongAn Online P is currently generating about -0.02 per unit of risk. If you would invest 504.00 in WIMFARM SA EO on September 14, 2024 and sell it today you would lose (147.00) from holding WIMFARM SA EO or give up 29.17% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
WIMFARM SA EO vs. ZhongAn Online P
Performance |
| Timeline |
| WIMFARM SA EO |
| ZhongAn Online P |
WIMFARM SA and ZhongAn Online Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WIMFARM SA and ZhongAn Online
The main advantage of trading using opposite WIMFARM SA and ZhongAn Online positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WIMFARM SA position performs unexpectedly, ZhongAn Online 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 ZhongAn Online will offset losses from the drop in ZhongAn Online's long position.| WIMFARM SA vs. AB Volvo | WIMFARM SA vs. Daimler Truck Holding | WIMFARM SA vs. Superior Plus Corp | WIMFARM SA vs. SIVERS SEMICONDUCTORS AB |
| ZhongAn Online vs. TFS FINANCIAL | ZhongAn Online vs. WIMFARM SA EO | ZhongAn Online vs. Hitachi Construction Machinery | ZhongAn Online vs. TITAN MACHINERY |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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