Correlation Between Wt Financial and Auswide Bank
Can any of the company-specific risk be diversified away by investing in both Wt Financial and Auswide Bank 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 Wt Financial and Auswide Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wt Financial Group and Auswide Bank, you can compare the effects of market volatilities on Wt Financial and Auswide Bank 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 Wt Financial with a short position of Auswide Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wt Financial and Auswide Bank.
Diversification Opportunities for Wt Financial and Auswide Bank
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between WTL and Auswide is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Wt Financial Group and Auswide Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Auswide Bank and Wt 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 Wt Financial Group are associated (or correlated) with Auswide Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Auswide Bank has no effect on the direction of Wt Financial i.e., Wt Financial and Auswide Bank go up and down completely randomly.
Pair Corralation between Wt Financial and Auswide Bank
Assuming the 90 days trading horizon Wt Financial Group is expected to generate 1.66 times more return on investment than Auswide Bank. However, Wt Financial is 1.66 times more volatile than Auswide Bank. It trades about 0.09 of its potential returns per unit of risk. Auswide Bank is currently generating about 0.07 per unit of risk. If you would invest 6.82 in Wt Financial Group on August 30, 2024 and sell it today you would earn a total of 2.18 from holding Wt Financial Group or generate 31.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wt Financial Group vs. Auswide Bank
Performance |
| Timeline |
| Wt Financial Group |
| Auswide Bank |
Wt Financial and Auswide Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wt Financial and Auswide Bank
The main advantage of trading using opposite Wt Financial and Auswide Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wt Financial position performs unexpectedly, Auswide Bank 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 Auswide Bank will offset losses from the drop in Auswide Bank's long position.| Wt Financial vs. Dicker Data | Wt Financial vs. Bio Gene Technology | Wt Financial vs. Ainsworth Game Technology | Wt Financial vs. TPG Telecom |
| Auswide Bank vs. Aneka Tambang Tbk | Auswide Bank vs. BHP Group Limited | Auswide Bank vs. Commonwealth Bank | Auswide Bank vs. Commonwealth Bank of |
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 Stocks Directory module to find actively traded stocks across global markets.
Other Complementary Tools
| CEOs Directory Screen CEOs from public companies around the world | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Bonds Directory Find actively traded corporate debentures issued by US companies |