Correlation Between Wheaton Precious and XLMedia PLC
Can any of the company-specific risk be diversified away by investing in both Wheaton Precious and XLMedia PLC 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 Wheaton Precious and XLMedia PLC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wheaton Precious Metals and XLMedia PLC, you can compare the effects of market volatilities on Wheaton Precious and XLMedia PLC 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 Wheaton Precious with a short position of XLMedia PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wheaton Precious and XLMedia PLC.
Diversification Opportunities for Wheaton Precious and XLMedia PLC
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Wheaton and XLMedia is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Wheaton Precious Metals and XLMedia PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on XLMedia PLC and Wheaton Precious 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 Wheaton Precious Metals are associated (or correlated) with XLMedia PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of XLMedia PLC has no effect on the direction of Wheaton Precious i.e., Wheaton Precious and XLMedia PLC go up and down completely randomly.
Pair Corralation between Wheaton Precious and XLMedia PLC
Assuming the 90 days trading horizon Wheaton Precious Metals is expected to generate 0.43 times more return on investment than XLMedia PLC. However, Wheaton Precious Metals is 2.32 times less risky than XLMedia PLC. It trades about 0.03 of its potential returns per unit of risk. XLMedia PLC is currently generating about 0.01 per unit of risk. If you would invest 352,182 in Wheaton Precious Metals on October 11, 2024 and sell it today you would earn a total of 113,318 from holding Wheaton Precious Metals or generate 32.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.6% |
| Values | Daily Returns |
Wheaton Precious Metals vs. XLMedia PLC
Performance |
| Timeline |
| Wheaton Precious Metals |
| XLMedia PLC |
Wheaton Precious and XLMedia PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wheaton Precious and XLMedia PLC
The main advantage of trading using opposite Wheaton Precious and XLMedia PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wheaton Precious position performs unexpectedly, XLMedia PLC 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 XLMedia PLC will offset losses from the drop in XLMedia PLC's long position.| Wheaton Precious vs. Qurate Retail Series | Wheaton Precious vs. Hochschild Mining plc | Wheaton Precious vs. Coor Service Management | Wheaton Precious vs. Endeavour Mining Corp |
| XLMedia PLC vs. McEwen Mining | XLMedia PLC vs. European Metals Holdings | XLMedia PLC vs. Axway Software SA | XLMedia PLC vs. Wheaton Precious Metals |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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