Correlation Between Woori Financial and Meta Financial
Can any of the company-specific risk be diversified away by investing in both Woori Financial and Meta Financial 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 Woori Financial and Meta Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Woori Financial Group and Meta Financial Group, you can compare the effects of market volatilities on Woori Financial and Meta Financial 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 Woori Financial with a short position of Meta Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Woori Financial and Meta Financial.
Diversification Opportunities for Woori Financial and Meta Financial
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Woori and Meta is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Woori Financial Group and Meta Financial Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Meta Financial Group and Woori Financial 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 Woori Financial Group are associated (or correlated) with Meta Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Meta Financial Group has no effect on the direction of Woori Financial i.e., Woori Financial and Meta Financial go up and down completely randomly.
Pair Corralation between Woori Financial and Meta Financial
Allowing for the 90-day total investment horizon Woori Financial is expected to generate 3.43 times less return on investment than Meta Financial. In addition to that, Woori Financial is 1.02 times more volatile than Meta Financial Group. It trades about 0.04 of its total potential returns per unit of risk. Meta Financial Group is currently generating about 0.15 per unit of volatility. If you would invest 5,071 in Meta Financial Group on August 27, 2024 and sell it today you would earn a total of 3,219 from holding Meta Financial Group or generate 63.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Woori Financial Group vs. Meta Financial Group
Performance |
| Timeline |
| Woori Financial Group |
| Meta Financial Group |
Woori Financial and Meta Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Woori Financial and Meta Financial
The main advantage of trading using opposite Woori Financial and Meta Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Woori Financial position performs unexpectedly, Meta Financial 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 Meta Financial will offset losses from the drop in Meta Financial's long position.| Woori Financial vs. Banco Santander Brasil | Woori Financial vs. CrossFirst Bankshares | Woori Financial vs. Banco Bradesco SA | Woori Financial vs. CF Bankshares |
| Meta Financial vs. Capitol Federal Financial | Meta Financial vs. Colony Bankcorp | Meta Financial vs. First Mid Illinois | Meta Financial vs. Meridian Bank |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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