Correlation Between Meiwu Technology and Seadrill
Can any of the company-specific risk be diversified away by investing in both Meiwu Technology and Seadrill 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 Seadrill 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 Seadrill Limited, you can compare the effects of market volatilities on Meiwu Technology and Seadrill 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 Seadrill. Check out your portfolio center. Please also check ongoing floating volatility patterns of Meiwu Technology and Seadrill.
Diversification Opportunities for Meiwu Technology and Seadrill
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Meiwu and Seadrill is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Meiwu Technology Co and Seadrill Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Seadrill Limited 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 Seadrill. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Seadrill Limited has no effect on the direction of Meiwu Technology i.e., Meiwu Technology and Seadrill go up and down completely randomly.
Pair Corralation between Meiwu Technology and Seadrill
Considering the 90-day investment horizon Meiwu Technology Co is expected to generate 1.63 times more return on investment than Seadrill. However, Meiwu Technology is 1.63 times more volatile than Seadrill Limited. It trades about 0.07 of its potential returns per unit of risk. Seadrill Limited is currently generating about -0.04 per unit of risk. If you would invest 83.00 in Meiwu Technology Co on August 29, 2024 and sell it today you would earn a total of 13.00 from holding Meiwu Technology Co or generate 15.66% 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. Seadrill Limited
Performance |
| Timeline |
| Meiwu Technology |
| Seadrill Limited |
Meiwu Technology and Seadrill Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Meiwu Technology and Seadrill
The main advantage of trading using opposite Meiwu Technology and Seadrill positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Meiwu Technology position performs unexpectedly, Seadrill 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 Seadrill will offset losses from the drop in Seadrill's long position.| Meiwu Technology vs. MOGU Inc | Meiwu Technology vs. iPower Inc | Meiwu Technology vs. Jeffs Brands | Meiwu Technology vs. Kidpik Corp |
| Seadrill vs. Noble plc | Seadrill vs. Nabors Industries | Seadrill vs. Precision Drilling | Seadrill vs. Sable Offshore Corp |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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