Correlation Between WinMate Communication and SYN Tech

Can any of the company-specific risk be diversified away by investing in both WinMate Communication and SYN Tech 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 WinMate Communication and SYN Tech into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between WinMate Communication INC and SYN Tech Chem Pharm, you can compare the effects of market volatilities on WinMate Communication and SYN Tech 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 WinMate Communication with a short position of SYN Tech. Check out your portfolio center. Please also check ongoing floating volatility patterns of WinMate Communication and SYN Tech.

Diversification Opportunities for WinMate Communication and SYN Tech

-0.22

Correlation Coefficient

WinMate Communication  SYN Tech

Very good diversification

The 3 months correlation between WinMate and SYN is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding WinMate Communication INC and SYN Tech Chem Pharm in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SYN Tech Chem and WinMate Communication 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 WinMate Communication INC are associated (or correlated) with SYN Tech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SYN Tech Chem has no effect on the direction of WinMate Communication i.e., WinMate Communication and SYN Tech go up and down completely randomly.

Pair Corralation between WinMate Communication and SYN Tech

Assuming the 90 days trading horizon WinMate Communication INC is expected to under-perform the SYN Tech. In addition to that, WinMate Communication is 1.9 times more volatile than SYN Tech Chem Pharm. It trades about -0.02 of its total potential returns per unit of risk. SYN Tech Chem Pharm is currently generating about 0.13 per unit of volatility. If you would invest  9,400  in SYN Tech Chem Pharm on December 29, 2024 and sell it today you would earn a total of  900.00  from holding SYN Tech Chem Pharm or generate 9.57% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.25%
Values	Daily Returns

WinMate Communication INC  vs.  SYN Tech Chem Pharm

WinMate Communication INC

Risk-Adjusted Performance

Very Weak

Over the last 90 days WinMate Communication INC has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, WinMate Communication is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

SYN Tech Chem

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in SYN Tech Chem Pharm are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, SYN Tech may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with WinMate Communication and SYN Tech

The main advantage of trading using opposite WinMate Communication and SYN Tech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WinMate Communication position performs unexpectedly, SYN Tech 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 SYN Tech will offset losses from the drop in SYN Tech's long position.

The idea behind WinMate Communication INC and SYN Tech Chem Pharm pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.