Correlation Between WIMFARM SA and Tsingtao Brewery
Can any of the company-specific risk be diversified away by investing in both WIMFARM SA and Tsingtao Brewery 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 Tsingtao Brewery 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 Tsingtao Brewery, you can compare the effects of market volatilities on WIMFARM SA and Tsingtao Brewery 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 Tsingtao Brewery. Check out your portfolio center. Please also check ongoing floating volatility patterns of WIMFARM SA and Tsingtao Brewery.
Diversification Opportunities for WIMFARM SA and Tsingtao Brewery
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between WIMFARM and Tsingtao is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding WIMFARM SA EO and Tsingtao Brewery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tsingtao Brewery 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 Tsingtao Brewery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tsingtao Brewery has no effect on the direction of WIMFARM SA i.e., WIMFARM SA and Tsingtao Brewery go up and down completely randomly.
Pair Corralation between WIMFARM SA and Tsingtao Brewery
Assuming the 90 days horizon WIMFARM SA EO is expected to under-perform the Tsingtao Brewery. But the stock apears to be less risky and, when comparing its historical volatility, WIMFARM SA EO is 1.62 times less risky than Tsingtao Brewery. The stock trades about -0.06 of its potential returns per unit of risk. The Tsingtao Brewery is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 417.00 in Tsingtao Brewery on September 1, 2024 and sell it today you would earn a total of 171.00 from holding Tsingtao Brewery or generate 41.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
WIMFARM SA EO vs. Tsingtao Brewery
Performance |
| Timeline |
| WIMFARM SA EO |
| Tsingtao Brewery |
WIMFARM SA and Tsingtao Brewery Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WIMFARM SA and Tsingtao Brewery
The main advantage of trading using opposite WIMFARM SA and Tsingtao Brewery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WIMFARM SA position performs unexpectedly, Tsingtao Brewery 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 Tsingtao Brewery will offset losses from the drop in Tsingtao Brewery's long position.| WIMFARM SA vs. UPDATE SOFTWARE | WIMFARM SA vs. XLMedia PLC | WIMFARM SA vs. GigaMedia | WIMFARM SA vs. FUYO GENERAL LEASE |
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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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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