Correlation Between CleanTech Lithium and Weiss Korea

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both CleanTech Lithium and Weiss Korea 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 CleanTech Lithium and Weiss Korea into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CleanTech Lithium plc and Weiss Korea Opportunity, you can compare the effects of market volatilities on CleanTech Lithium and Weiss Korea 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 CleanTech Lithium with a short position of Weiss Korea. Check out your portfolio center. Please also check ongoing floating volatility patterns of CleanTech Lithium and Weiss Korea.

Diversification Opportunities for CleanTech Lithium and Weiss Korea

CleanTechWeissDiversified AwayCleanTechWeissDiversified Away100%
0.47
  Correlation Coefficient

Very weak diversification

The 3 months correlation between CleanTech and Weiss is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding CleanTech Lithium plc and Weiss Korea Opportunity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Weiss Korea Opportunity and CleanTech Lithium 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 CleanTech Lithium plc are associated (or correlated) with Weiss Korea. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Weiss Korea Opportunity has no effect on the direction of CleanTech Lithium i.e., CleanTech Lithium and Weiss Korea go up and down completely randomly.

Pair Corralation between CleanTech Lithium and Weiss Korea

Assuming the 90 days trading horizon CleanTech Lithium plc is expected to generate 1.25 times more return on investment than Weiss Korea. However, CleanTech Lithium is 1.25 times more volatile than Weiss Korea Opportunity. It trades about 0.04 of its potential returns per unit of risk. Weiss Korea Opportunity is currently generating about -0.17 per unit of risk. If you would invest  1,770  in CleanTech Lithium plc on September 21, 2024 and sell it today you would earn a total of  30.00  from holding CleanTech Lithium plc or generate 1.69% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

CleanTech Lithium plc  vs.  Weiss Korea Opportunity

 Performance 
JavaScript chart by amCharts 3.21.15OctNovDec -50-40-30-20-100
JavaScript chart by amCharts 3.21.15CTL WKOF
       Timeline  
CleanTech Lithium plc 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days CleanTech Lithium plc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's technical and fundamental indicators remain rather sound which may send shares a bit higher in January 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.
JavaScript chart by amCharts 3.21.15OctNovDecNovDec161820222426283032
Weiss Korea Opportunity 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Weiss Korea Opportunity has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in January 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.
JavaScript chart by amCharts 3.21.15OctNovDecNovDec130135140145150155160

CleanTech Lithium and Weiss Korea Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-7.17-5.37-3.57-1.77-0.031.42.854.295.747.19 0.050.100.150.20
JavaScript chart by amCharts 3.21.15CTL WKOF
       Returns  

Pair Trading with CleanTech Lithium and Weiss Korea

The main advantage of trading using opposite CleanTech Lithium and Weiss Korea positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CleanTech Lithium position performs unexpectedly, Weiss Korea 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 Weiss Korea will offset losses from the drop in Weiss Korea's long position.
The idea behind CleanTech Lithium plc and Weiss Korea Opportunity pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.

Other Complementary Tools

Price Transformation
Use Price Transformation models to analyze the depth of different equity instruments across global markets
Portfolio Analyzer
Portfolio analysis module that provides access to portfolio diagnostics and optimization engine
Efficient Frontier
Plot and analyze your portfolio and positions against risk-return landscape of the market.
My Watchlist Analysis
Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like
Price Exposure Probability
Analyze equity upside and downside potential for a given time horizon across multiple markets


 

Discover investing ideas

Utilize additional investing modules