Correlation Between Weyco and Sanyo Special

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Can any of the company-specific risk be diversified away by investing in both Weyco and Sanyo Special 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 Sanyo Special into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Weyco Group and Sanyo Special Steel, you can compare the effects of market volatilities on Weyco and Sanyo Special 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 Sanyo Special. Check out your portfolio center. Please also check ongoing floating volatility patterns of Weyco and Sanyo Special.

Diversification Opportunities for Weyco and Sanyo Special

0.46
  Correlation Coefficient

Very weak diversification

The 3 months correlation between Weyco and Sanyo is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Weyco Group and Sanyo Special Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sanyo Special Steel 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 Sanyo Special. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sanyo Special Steel has no effect on the direction of Weyco i.e., Weyco and Sanyo Special go up and down completely randomly.

Pair Corralation between Weyco and Sanyo Special

If you would invest  3,382  in Weyco Group on August 31, 2024 and sell it today you would earn a total of  181.00  from holding Weyco Group or generate 5.35% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

Weyco Group  vs.  Sanyo Special Steel

 Performance 
       Timeline  
Weyco Group 

Risk-Adjusted Performance

4 of 100

 
Weak
 
Strong
Insignificant
Compared to the overall equity markets, risk-adjusted returns on investments in Weyco Group are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unfluctuating basic indicators, Weyco may actually be approaching a critical reversion point that can send shares even higher in December 2024.
Sanyo Special Steel 

Risk-Adjusted Performance

9 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Sanyo Special Steel are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable essential indicators, Sanyo Special is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Weyco and Sanyo Special Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Weyco and Sanyo Special

The main advantage of trading using opposite Weyco and Sanyo Special positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Weyco position performs unexpectedly, Sanyo Special 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 Sanyo Special will offset losses from the drop in Sanyo Special's long position.
The idea behind Weyco Group and Sanyo Special Steel 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.
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..

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