Correlation Between WinMate Communication and Dimension Computer

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Can any of the company-specific risk be diversified away by investing in both WinMate Communication and Dimension Computer 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 Dimension Computer 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 Dimension Computer Technology, you can compare the effects of market volatilities on WinMate Communication and Dimension Computer 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 Dimension Computer. Check out your portfolio center. Please also check ongoing floating volatility patterns of WinMate Communication and Dimension Computer.

Diversification Opportunities for WinMate Communication and Dimension Computer

WinMateDimensionDiversified AwayWinMateDimensionDiversified Away100%
-0.17
  Correlation Coefficient

Good diversification

The 3 months correlation between WinMate and Dimension is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding WinMate Communication INC and Dimension Computer Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dimension Computer 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 Dimension Computer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dimension Computer has no effect on the direction of WinMate Communication i.e., WinMate Communication and Dimension Computer go up and down completely randomly.

Pair Corralation between WinMate Communication and Dimension Computer

Assuming the 90 days trading horizon WinMate Communication INC is expected to generate 0.56 times more return on investment than Dimension Computer. However, WinMate Communication INC is 1.79 times less risky than Dimension Computer. It trades about 0.04 of its potential returns per unit of risk. Dimension Computer Technology is currently generating about -0.02 per unit of risk. If you would invest  14,650  in WinMate Communication INC on September 26, 2024 and sell it today you would earn a total of  450.00  from holding WinMate Communication INC or generate 3.07% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

WinMate Communication INC  vs.  Dimension Computer Technology

 Performance 
JavaScript chart by amCharts 3.21.15OctNovDec -15-10-50510
JavaScript chart by amCharts 3.21.153416 6140
       Timeline  
WinMate Communication INC 

Risk-Adjusted Performance

3 of 100

 
Weak
 
Strong
Insignificant
Compared to the overall equity markets, risk-adjusted returns on investments in WinMate Communication INC are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. 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.
JavaScript chart by amCharts 3.21.15OctNovDecNovDec135140145150155
Dimension Computer 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Dimension Computer Technology has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Dimension Computer is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.
JavaScript chart by amCharts 3.21.15OctNovDecNovDec2224262830

WinMate Communication and Dimension Computer Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-4.69-3.51-2.34-1.16-0.01961.142.343.534.735.93 0.050.100.15
JavaScript chart by amCharts 3.21.153416 6140
       Returns  

Pair Trading with WinMate Communication and Dimension Computer

The main advantage of trading using opposite WinMate Communication and Dimension Computer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WinMate Communication position performs unexpectedly, Dimension Computer 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 Dimension Computer will offset losses from the drop in Dimension Computer's long position.
The idea behind WinMate Communication INC and Dimension Computer Technology 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.
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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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.

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