Correlation Between Weyco and Stevanato Group
Can any of the company-specific risk be diversified away by investing in both Weyco and Stevanato Group 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 Weyco and Stevanato Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Weyco Group and Stevanato Group SpA, you can compare the effects of market volatilities on Weyco and Stevanato Group 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 Weyco with a short position of Stevanato Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Weyco and Stevanato Group.
Diversification Opportunities for Weyco and Stevanato Group
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Weyco and Stevanato is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Weyco Group and Stevanato Group SpA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stevanato Group SpA and Weyco 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 Weyco Group are associated (or correlated) with Stevanato Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stevanato Group SpA has no effect on the direction of Weyco i.e., Weyco and Stevanato Group go up and down completely randomly.
Pair Corralation between Weyco and Stevanato Group
Given the investment horizon of 90 days Weyco Group is expected to generate 0.69 times more return on investment than Stevanato Group. However, Weyco Group is 1.45 times less risky than Stevanato Group. It trades about 0.07 of its potential returns per unit of risk. Stevanato Group SpA is currently generating about -0.02 per unit of risk. If you would invest 2,511 in Weyco Group on September 1, 2024 and sell it today you would earn a total of 1,060 from holding Weyco Group or generate 42.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Weyco Group vs. Stevanato Group SpA
Performance |
| Timeline |
| Weyco Group |
| Stevanato Group SpA |
Weyco and Stevanato Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Weyco and Stevanato Group
The main advantage of trading using opposite Weyco and Stevanato Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Weyco position performs unexpectedly, Stevanato Group 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 Stevanato Group will offset losses from the drop in Stevanato Group's long position.The idea behind Weyco Group and Stevanato Group SpA pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Stevanato Group vs. Haemonetics | Stevanato Group vs. Merit Medical Systems | Stevanato Group vs. AngioDynamics | Stevanato Group vs. AptarGroup |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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