Correlation Between WIMFARM SA and Chuangs China
Can any of the company-specific risk be diversified away by investing in both WIMFARM SA and Chuangs China 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 Chuangs China 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 Chuangs China Investments, you can compare the effects of market volatilities on WIMFARM SA and Chuangs China 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 Chuangs China. Check out your portfolio center. Please also check ongoing floating volatility patterns of WIMFARM SA and Chuangs China.
Diversification Opportunities for WIMFARM SA and Chuangs China
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between WIMFARM and Chuangs is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding WIMFARM SA EO and Chuangs China Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chuangs China Investments 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 Chuangs China. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chuangs China Investments has no effect on the direction of WIMFARM SA i.e., WIMFARM SA and Chuangs China go up and down completely randomly.
Pair Corralation between WIMFARM SA and Chuangs China
Assuming the 90 days horizon WIMFARM SA EO is expected to under-perform the Chuangs China. In addition to that, WIMFARM SA is 3.66 times more volatile than Chuangs China Investments. It trades about -0.13 of its total potential returns per unit of risk. Chuangs China Investments is currently generating about 0.01 per unit of volatility. If you would invest 1.00 in Chuangs China Investments on August 28, 2024 and sell it today you would earn a total of 0.00 from holding Chuangs China Investments or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
WIMFARM SA EO vs. Chuangs China Investments
Performance |
| Timeline |
| WIMFARM SA EO |
| Chuangs China Investments |
WIMFARM SA and Chuangs China Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WIMFARM SA and Chuangs China
The main advantage of trading using opposite WIMFARM SA and Chuangs China positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WIMFARM SA position performs unexpectedly, Chuangs China 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 Chuangs China will offset losses from the drop in Chuangs China's long position.| WIMFARM SA vs. Superior Plus Corp | WIMFARM SA vs. NMI Holdings | WIMFARM SA vs. Origin Agritech | WIMFARM SA vs. SIVERS SEMICONDUCTORS AB |
| Chuangs China vs. Superior Plus Corp | Chuangs China vs. NMI Holdings | Chuangs China vs. Origin Agritech | Chuangs China vs. SIVERS SEMICONDUCTORS AB |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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