Correlation Between Western Union and 360 Finance
Can any of the company-specific risk be diversified away by investing in both Western Union and 360 Finance 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 Western Union and 360 Finance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Western Union Co and 360 Finance, you can compare the effects of market volatilities on Western Union and 360 Finance 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 Western Union with a short position of 360 Finance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western Union and 360 Finance.
Diversification Opportunities for Western Union and 360 Finance
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Western and 360 is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Western Union Co and 360 Finance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 360 Finance and Western Union 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 Western Union Co are associated (or correlated) with 360 Finance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 360 Finance has no effect on the direction of Western Union i.e., Western Union and 360 Finance go up and down completely randomly.
Pair Corralation between Western Union and 360 Finance
Allowing for the 90-day total investment horizon Western Union Co is expected to under-perform the 360 Finance. But the stock apears to be less risky and, when comparing its historical volatility, Western Union Co is 1.98 times less risky than 360 Finance. The stock trades about 0.0 of its potential returns per unit of risk. The 360 Finance is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 1,535 in 360 Finance on August 24, 2024 and sell it today you would earn a total of 1,918 from holding 360 Finance or generate 124.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Western Union Co vs. 360 Finance
Performance |
| Timeline |
| Western Union |
| 360 Finance |
Western Union and 360 Finance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Western Union and 360 Finance
The main advantage of trading using opposite Western Union and 360 Finance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Western Union position performs unexpectedly, 360 Finance 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 360 Finance will offset losses from the drop in 360 Finance's long position.| Western Union vs. American Express | Western Union vs. PayPal Holdings | Western Union vs. Capital One Financial | Western Union vs. Upstart Holdings |
| 360 Finance vs. CF Industries Holdings | 360 Finance vs. Natural Alternatives International | 360 Finance vs. Albertsons Companies | 360 Finance vs. Arq Inc |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
Other Complementary Tools
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon |