Correlation Between WM Technology and Maple Gold
Can any of the company-specific risk be diversified away by investing in both WM Technology and Maple Gold 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 WM Technology and Maple Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WM Technology and Maple Gold Mines, you can compare the effects of market volatilities on WM Technology and Maple Gold 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 WM Technology with a short position of Maple Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of WM Technology and Maple Gold.
Diversification Opportunities for WM Technology and Maple Gold
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between MAPSW and Maple is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding WM Technology and Maple Gold Mines in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Maple Gold Mines and WM Technology 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 WM Technology are associated (or correlated) with Maple Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Maple Gold Mines has no effect on the direction of WM Technology i.e., WM Technology and Maple Gold go up and down completely randomly.
Pair Corralation between WM Technology and Maple Gold
Assuming the 90 days horizon WM Technology is expected to generate 1.61 times more return on investment than Maple Gold. However, WM Technology is 1.61 times more volatile than Maple Gold Mines. It trades about 0.06 of its potential returns per unit of risk. Maple Gold Mines is currently generating about -0.05 per unit of risk. If you would invest 2.70 in WM Technology on September 14, 2024 and sell it today you would lose (0.04) from holding WM Technology or give up 1.48% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
WM Technology vs. Maple Gold Mines
Performance |
| Timeline |
| WM Technology |
| Maple Gold Mines |
WM Technology and Maple Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WM Technology and Maple Gold
The main advantage of trading using opposite WM Technology and Maple Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WM Technology position performs unexpectedly, Maple Gold 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 Maple Gold will offset losses from the drop in Maple Gold's long position.| WM Technology vs. C3 Ai Inc | WM Technology vs. Shopify | WM Technology vs. Workday | WM Technology vs. Intuit Inc |
| Maple Gold vs. Advantage Solutions | Maple Gold vs. Atlas Corp | Maple Gold vs. PureCycle Technologies | Maple Gold vs. WM Technology |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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