Correlation Between Meiwu Technology and NiSource
Can any of the company-specific risk be diversified away by investing in both Meiwu Technology and NiSource 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 Meiwu Technology and NiSource into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Meiwu Technology Co and NiSource, you can compare the effects of market volatilities on Meiwu Technology and NiSource 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 Meiwu Technology with a short position of NiSource. Check out your portfolio center. Please also check ongoing floating volatility patterns of Meiwu Technology and NiSource.
Diversification Opportunities for Meiwu Technology and NiSource
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Meiwu and NiSource is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Meiwu Technology Co and NiSource in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NiSource and Meiwu 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 Meiwu Technology Co are associated (or correlated) with NiSource. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NiSource has no effect on the direction of Meiwu Technology i.e., Meiwu Technology and NiSource go up and down completely randomly.
Pair Corralation between Meiwu Technology and NiSource
Considering the 90-day investment horizon Meiwu Technology Co is expected to generate 3.51 times more return on investment than NiSource. However, Meiwu Technology is 3.51 times more volatile than NiSource. It trades about 0.34 of its potential returns per unit of risk. NiSource is currently generating about 0.38 per unit of risk. If you would invest 77.00 in Meiwu Technology Co on September 1, 2024 and sell it today you would earn a total of 21.00 from holding Meiwu Technology Co or generate 27.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Meiwu Technology Co vs. NiSource
Performance |
| Timeline |
| Meiwu Technology |
| NiSource |
Meiwu Technology and NiSource Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Meiwu Technology and NiSource
The main advantage of trading using opposite Meiwu Technology and NiSource positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Meiwu Technology position performs unexpectedly, NiSource 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 NiSource will offset losses from the drop in NiSource's long position.| Meiwu Technology vs. MOGU Inc | Meiwu Technology vs. iPower Inc | Meiwu Technology vs. Jeffs Brands | Meiwu Technology vs. Kidpik Corp |
| NiSource vs. NorthWestern | NiSource vs. Avista | NiSource vs. Otter Tail | NiSource vs. Companhia Paranaense de |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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