Correlation Between Weibo Corp and HCM Acquisition
Can any of the company-specific risk be diversified away by investing in both Weibo Corp and HCM Acquisition 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 Weibo Corp and HCM Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Weibo Corp and HCM Acquisition Corp, you can compare the effects of market volatilities on Weibo Corp and HCM Acquisition 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 Weibo Corp with a short position of HCM Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of Weibo Corp and HCM Acquisition.
Diversification Opportunities for Weibo Corp and HCM Acquisition
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Weibo and HCM is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Weibo Corp and HCM Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HCM Acquisition Corp and Weibo Corp 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 Weibo Corp are associated (or correlated) with HCM Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HCM Acquisition Corp has no effect on the direction of Weibo Corp i.e., Weibo Corp and HCM Acquisition go up and down completely randomly.
Pair Corralation between Weibo Corp and HCM Acquisition
Allowing for the 90-day total investment horizon Weibo Corp is expected to under-perform the HCM Acquisition. In addition to that, Weibo Corp is 8.71 times more volatile than HCM Acquisition Corp. It trades about -0.01 of its total potential returns per unit of risk. HCM Acquisition Corp is currently generating about 0.1 per unit of volatility. If you would invest 1,023 in HCM Acquisition Corp on September 4, 2024 and sell it today you would earn a total of 54.00 from holding HCM Acquisition Corp or generate 5.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 30.3% |
| Values | Daily Returns |
Weibo Corp vs. HCM Acquisition Corp
Performance |
| Timeline |
| Weibo Corp |
| HCM Acquisition Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Weibo Corp and HCM Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Weibo Corp and HCM Acquisition
The main advantage of trading using opposite Weibo Corp and HCM Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Weibo Corp position performs unexpectedly, HCM Acquisition 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 HCM Acquisition will offset losses from the drop in HCM Acquisition's long position.| Weibo Corp vs. YY Inc Class | Weibo Corp vs. DouYu International Holdings | Weibo Corp vs. Tencent Music Entertainment | Weibo Corp vs. Autohome |
| HCM Acquisition vs. Q2 Holdings | HCM Acquisition vs. Asure Software | HCM Acquisition vs. Eastman Kodak Co | HCM Acquisition vs. Coty 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
Other Complementary Tools
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency |