Correlation Between Nintendo and Wilmar International
Can any of the company-specific risk be diversified away by investing in both Nintendo and Wilmar International 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 Nintendo and Wilmar International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nintendo Co ADR and Wilmar International Limited, you can compare the effects of market volatilities on Nintendo and Wilmar International 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 Nintendo with a short position of Wilmar International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nintendo and Wilmar International.
Diversification Opportunities for Nintendo and Wilmar International
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Nintendo and Wilmar is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Nintendo Co ADR and Wilmar International Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wilmar International and Nintendo 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 Nintendo Co ADR are associated (or correlated) with Wilmar International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wilmar International has no effect on the direction of Nintendo i.e., Nintendo and Wilmar International go up and down completely randomly.
Pair Corralation between Nintendo and Wilmar International
Assuming the 90 days horizon Nintendo is expected to generate 1.61 times less return on investment than Wilmar International. But when comparing it to its historical volatility, Nintendo Co ADR is 2.36 times less risky than Wilmar International. It trades about 0.04 of its potential returns per unit of risk. Wilmar International Limited is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 218.00 in Wilmar International Limited on November 5, 2024 and sell it today you would earn a total of 8.00 from holding Wilmar International Limited or generate 3.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 81.71% |
| Values | Daily Returns |
Nintendo Co ADR vs. Wilmar International Limited
Performance |
| Timeline |
| Nintendo Co ADR |
| Wilmar International |
Nintendo and Wilmar International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nintendo and Wilmar International
The main advantage of trading using opposite Nintendo and Wilmar International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nintendo position performs unexpectedly, Wilmar International 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 Wilmar International will offset losses from the drop in Wilmar International's long position.| Nintendo vs. Square Enix Holdings | Nintendo vs. Capcom Co Ltd | Nintendo vs. Electronic Arts | Nintendo vs. Roblox Corp |
| Wilmar International vs. Fresh Del Monte | Wilmar International vs. Limoneira Co | Wilmar International vs. Brasilagro Adr | Wilmar International vs. Alico Inc |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
Other Complementary Tools
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data |