Correlation Between Bel Fuse and Weibo Corp
Can any of the company-specific risk be diversified away by investing in both Bel Fuse and Weibo Corp 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 Bel Fuse and Weibo Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bel Fuse A and Weibo Corp, you can compare the effects of market volatilities on Bel Fuse and Weibo Corp 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 Bel Fuse with a short position of Weibo Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bel Fuse and Weibo Corp.
Diversification Opportunities for Bel Fuse and Weibo Corp
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Bel and Weibo is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Bel Fuse A and Weibo Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Weibo Corp and Bel Fuse 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 Bel Fuse A are associated (or correlated) with Weibo Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Weibo Corp has no effect on the direction of Bel Fuse i.e., Bel Fuse and Weibo Corp go up and down completely randomly.
Pair Corralation between Bel Fuse and Weibo Corp
Assuming the 90 days horizon Bel Fuse A is expected to generate 0.91 times more return on investment than Weibo Corp. However, Bel Fuse A is 1.1 times less risky than Weibo Corp. It trades about 0.07 of its potential returns per unit of risk. Weibo Corp is currently generating about -0.01 per unit of risk. If you would invest 5,438 in Bel Fuse A on August 31, 2024 and sell it today you would earn a total of 4,228 from holding Bel Fuse A or generate 77.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.47% |
| Values | Daily Returns |
Bel Fuse A vs. Weibo Corp
Performance |
| Timeline |
| Bel Fuse A |
| Weibo Corp |
Bel Fuse and Weibo Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bel Fuse and Weibo Corp
The main advantage of trading using opposite Bel Fuse and Weibo Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bel Fuse position performs unexpectedly, Weibo Corp 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 Weibo Corp will offset losses from the drop in Weibo Corp's long position.| Bel Fuse vs. Sanmina | Bel Fuse vs. Benchmark Electronics | Bel Fuse vs. Celestica | Bel Fuse vs. CTS Corporation |
| Weibo Corp vs. YY Inc Class | Weibo Corp vs. DouYu International Holdings | Weibo Corp vs. Tencent Music Entertainment | Weibo Corp vs. Autohome |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
Other Complementary Tools
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing |