Correlation Between WinMate Communication and New Era
Can any of the company-specific risk be diversified away by investing in both WinMate Communication and New Era 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 New Era 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 New Era Electronics, you can compare the effects of market volatilities on WinMate Communication and New Era 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 New Era. Check out your portfolio center. Please also check ongoing floating volatility patterns of WinMate Communication and New Era.
Diversification Opportunities for WinMate Communication and New Era
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between WinMate and New is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding WinMate Communication INC and New Era Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on New Era Electronics 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 New Era. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of New Era Electronics has no effect on the direction of WinMate Communication i.e., WinMate Communication and New Era go up and down completely randomly.
Pair Corralation between WinMate Communication and New Era
Assuming the 90 days trading horizon WinMate Communication INC is expected to under-perform the New Era. But the stock apears to be less risky and, when comparing its historical volatility, WinMate Communication INC is 1.73 times less risky than New Era. The stock trades about -0.06 of its potential returns per unit of risk. The New Era Electronics is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 11,800 in New Era Electronics on September 24, 2024 and sell it today you would lose (50.00) from holding New Era Electronics or give up 0.42% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
WinMate Communication INC vs. New Era Electronics
Performance |
Timeline |
WinMate Communication INC |
New Era Electronics |
WinMate Communication and New Era Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with WinMate Communication and New Era
The main advantage of trading using opposite WinMate Communication and New Era positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WinMate Communication position performs unexpectedly, New Era 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 New Era will offset losses from the drop in New Era's long position.WinMate Communication vs. Advantech Co | WinMate Communication vs. IEI Integration Corp | WinMate Communication vs. Flytech Technology Co | WinMate Communication vs. Ennoconn Corp |
New Era vs. Central Reinsurance Corp | New Era vs. Materials Analysis Technology | New Era vs. WinMate Communication INC | New Era vs. Simplo Technology Co |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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