Correlation Between Wetouch Technology and Western Capital
Can any of the company-specific risk be diversified away by investing in both Wetouch Technology and Western Capital 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 Western Capital 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 Western Capital Resources, you can compare the effects of market volatilities on Wetouch Technology and Western Capital 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 Western Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wetouch Technology and Western Capital.
Diversification Opportunities for Wetouch Technology and Western Capital
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Wetouch and Western is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Wetouch Technology Common and Western Capital Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Western Capital Resources 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 Western Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Western Capital Resources has no effect on the direction of Wetouch Technology i.e., Wetouch Technology and Western Capital go up and down completely randomly.
Pair Corralation between Wetouch Technology and Western Capital
Given the investment horizon of 90 days Wetouch Technology is expected to generate 5.64 times less return on investment than Western Capital. In addition to that, Wetouch Technology is 2.15 times more volatile than Western Capital Resources. It trades about 0.03 of its total potential returns per unit of risk. Western Capital Resources is currently generating about 0.34 per unit of volatility. If you would invest 800.00 in Western Capital Resources on September 1, 2024 and sell it today you would earn a total of 128.00 from holding Western Capital Resources or generate 16.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wetouch Technology Common vs. Western Capital Resources
Performance |
| Timeline |
| Wetouch Technology Common |
| Western Capital Resources |
Wetouch Technology and Western Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wetouch Technology and Western Capital
The main advantage of trading using opposite Wetouch Technology and Western Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wetouch Technology position performs unexpectedly, Western Capital 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 Western Capital will offset losses from the drop in Western Capital'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 |
| Western Capital vs. Porsche Automobile Holding | Western Capital vs. Ferrari NV | Western Capital vs. Toyota Motor | Western Capital vs. General Motors |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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