Correlation Between Wetouch Technology and Santeon
Can any of the company-specific risk be diversified away by investing in both Wetouch Technology and Santeon 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 Wetouch Technology and Santeon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wetouch Technology Common and Santeon Group, you can compare the effects of market volatilities on Wetouch Technology and Santeon 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 Wetouch Technology with a short position of Santeon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wetouch Technology and Santeon.
Diversification Opportunities for Wetouch Technology and Santeon
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Wetouch and Santeon is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Wetouch Technology Common and Santeon Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Santeon Group and Wetouch 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 Wetouch Technology Common are associated (or correlated) with Santeon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Santeon Group has no effect on the direction of Wetouch Technology i.e., Wetouch Technology and Santeon go up and down completely randomly.
Pair Corralation between Wetouch Technology and Santeon
Given the investment horizon of 90 days Wetouch Technology Common is expected to under-perform the Santeon. But the otc stock apears to be less risky and, when comparing its historical volatility, Wetouch Technology Common is 1.86 times less risky than Santeon. The otc stock trades about -0.02 of its potential returns per unit of risk. The Santeon Group is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 2.00 in Santeon Group on September 1, 2024 and sell it today you would earn a total of 3.00 from holding Santeon Group or generate 150.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wetouch Technology Common vs. Santeon Group
Performance |
| Timeline |
| Wetouch Technology Common |
| Santeon Group |
Wetouch Technology and Santeon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wetouch Technology and Santeon
The main advantage of trading using opposite Wetouch Technology and Santeon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wetouch Technology position performs unexpectedly, Santeon 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 Santeon will offset losses from the drop in Santeon's long position.| Wetouch Technology vs. Western Capital Resources | Wetouch Technology vs. Tree Island Steel | Wetouch Technology vs. Santeon Group | Wetouch Technology vs. Ferrexpo PLC |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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