Correlation Between Oberweis China and Matthews Pacific
Can any of the company-specific risk be diversified away by investing in both Oberweis China and Matthews Pacific 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 Oberweis China and Matthews Pacific into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Oberweis China Opportunities and Matthews Pacific Tiger, you can compare the effects of market volatilities on Oberweis China and Matthews Pacific 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 Oberweis China with a short position of Matthews Pacific. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oberweis China and Matthews Pacific.
Diversification Opportunities for Oberweis China and Matthews Pacific
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Oberweis and Matthews is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Oberweis China Opportunities and Matthews Pacific Tiger in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Matthews Pacific Tiger and Oberweis China 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 Oberweis China Opportunities are associated (or correlated) with Matthews Pacific. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Matthews Pacific Tiger has no effect on the direction of Oberweis China i.e., Oberweis China and Matthews Pacific go up and down completely randomly.
Pair Corralation between Oberweis China and Matthews Pacific
Assuming the 90 days horizon Oberweis China Opportunities is expected to generate 1.27 times more return on investment than Matthews Pacific. However, Oberweis China is 1.27 times more volatile than Matthews Pacific Tiger. It trades about 0.14 of its potential returns per unit of risk. Matthews Pacific Tiger is currently generating about 0.01 per unit of risk. If you would invest 676.00 in Oberweis China Opportunities on November 3, 2024 and sell it today you would earn a total of 26.00 from holding Oberweis China Opportunities or generate 3.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Oberweis China Opportunities vs. Matthews Pacific Tiger
Performance |
| Timeline |
| Oberweis China Oppor |
| Matthews Pacific Tiger |
Oberweis China and Matthews Pacific Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oberweis China and Matthews Pacific
The main advantage of trading using opposite Oberweis China and Matthews Pacific positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oberweis China position performs unexpectedly, Matthews Pacific 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 Matthews Pacific will offset losses from the drop in Matthews Pacific's long position.| Oberweis China vs. Matthews China Fund | Oberweis China vs. T Rowe Price | Oberweis China vs. Matthews India Fund | Oberweis China vs. Guinness Atkinson China |
| Matthews Pacific vs. Matthews Asian Growth | Matthews Pacific vs. Matthews China Fund | Matthews Pacific vs. Matthews India Fund | Matthews Pacific vs. Matthews Asia Growth |
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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