Correlation Between BAIYU Holdings and Western Digital
Can any of the company-specific risk be diversified away by investing in both BAIYU Holdings and Western Digital 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 BAIYU Holdings and Western Digital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BAIYU Holdings and Western Digital, you can compare the effects of market volatilities on BAIYU Holdings and Western Digital 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 BAIYU Holdings with a short position of Western Digital. Check out your portfolio center. Please also check ongoing floating volatility patterns of BAIYU Holdings and Western Digital.
Diversification Opportunities for BAIYU Holdings and Western Digital
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between BAIYU and Western is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding BAIYU Holdings and Western Digital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Western Digital and BAIYU Holdings 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 BAIYU Holdings are associated (or correlated) with Western Digital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Western Digital has no effect on the direction of BAIYU Holdings i.e., BAIYU Holdings and Western Digital go up and down completely randomly.
Pair Corralation between BAIYU Holdings and Western Digital
Considering the 90-day investment horizon BAIYU Holdings is expected to under-perform the Western Digital. In addition to that, BAIYU Holdings is 1.52 times more volatile than Western Digital. It trades about -0.25 of its total potential returns per unit of risk. Western Digital is currently generating about 0.09 per unit of volatility. If you would invest 6,830 in Western Digital on August 30, 2024 and sell it today you would earn a total of 320.00 from holding Western Digital or generate 4.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 78.26% |
| Values | Daily Returns |
BAIYU Holdings vs. Western Digital
Performance |
| Timeline |
| BAIYU Holdings |
| Western Digital |
BAIYU Holdings and Western Digital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BAIYU Holdings and Western Digital
The main advantage of trading using opposite BAIYU Holdings and Western Digital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BAIYU Holdings position performs unexpectedly, Western Digital 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 Western Digital will offset losses from the drop in Western Digital's long position.| BAIYU Holdings vs. Western Digital | BAIYU Holdings vs. Viemed Healthcare | BAIYU Holdings vs. Meiwu Technology Co | BAIYU Holdings vs. Centessa Pharmaceuticals PLC |
| Western Digital vs. Rigetti Computing | Western Digital vs. D Wave Quantum | Western Digital vs. IONQ Inc | Western Digital vs. Desktop Metal |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
Other Complementary Tools
| Transaction History View history of all your transactions and understand their impact on performance | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance |