Correlation Between Westaim Corp and MOBILE FACTORY
Can any of the company-specific risk be diversified away by investing in both Westaim Corp and MOBILE FACTORY 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 Westaim Corp and MOBILE FACTORY into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Westaim Corp and MOBILE FACTORY INC, you can compare the effects of market volatilities on Westaim Corp and MOBILE FACTORY 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 Westaim Corp with a short position of MOBILE FACTORY. Check out your portfolio center. Please also check ongoing floating volatility patterns of Westaim Corp and MOBILE FACTORY.
Diversification Opportunities for Westaim Corp and MOBILE FACTORY
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Westaim and MOBILE is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding The Westaim Corp and MOBILE FACTORY INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MOBILE FACTORY INC and Westaim 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 The Westaim Corp are associated (or correlated) with MOBILE FACTORY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MOBILE FACTORY INC has no effect on the direction of Westaim Corp i.e., Westaim Corp and MOBILE FACTORY go up and down completely randomly.
Pair Corralation between Westaim Corp and MOBILE FACTORY
Assuming the 90 days trading horizon The Westaim Corp is expected to generate 0.41 times more return on investment than MOBILE FACTORY. However, The Westaim Corp is 2.45 times less risky than MOBILE FACTORY. It trades about -0.06 of its potential returns per unit of risk. MOBILE FACTORY INC is currently generating about -0.03 per unit of risk. If you would invest 2,016 in The Westaim Corp on October 16, 2024 and sell it today you would lose (12.00) from holding The Westaim Corp or give up 0.6% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Westaim Corp vs. MOBILE FACTORY INC
Performance |
| Timeline |
| Westaim Corp |
| MOBILE FACTORY INC |
Westaim Corp and MOBILE FACTORY Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Westaim Corp and MOBILE FACTORY
The main advantage of trading using opposite Westaim Corp and MOBILE FACTORY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Westaim Corp position performs unexpectedly, MOBILE FACTORY 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 MOBILE FACTORY will offset losses from the drop in MOBILE FACTORY's long position.| Westaim Corp vs. MOBILE FACTORY INC | Westaim Corp vs. GAMESTOP | Westaim Corp vs. SOCKET MOBILE NEW | Westaim Corp vs. G III Apparel Group |
| MOBILE FACTORY vs. Sea Limited | MOBILE FACTORY vs. Electronic Arts | MOBILE FACTORY vs. NEXON Co | MOBILE FACTORY vs. NEXON Co |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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