Correlation Between Greenland Technologies and Weir Group

Can any of the company-specific risk be diversified away by investing in both Greenland Technologies and Weir Group 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 Greenland Technologies and Weir Group into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Greenland Technologies Holding and Weir Group PLC, you can compare the effects of market volatilities on Greenland Technologies and Weir Group 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 Greenland Technologies with a short position of Weir Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Greenland Technologies and Weir Group.

Diversification Opportunities for Greenland Technologies and Weir Group

-0.08

Correlation Coefficient

Greenland Technologies  Weir Group

Good diversification

The 3 months correlation between Greenland and Weir is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Greenland Technologies Holding and Weir Group PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Weir Group PLC and Greenland Technologies 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 Greenland Technologies Holding are associated (or correlated) with Weir Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Weir Group PLC has no effect on the direction of Greenland Technologies i.e., Greenland Technologies and Weir Group go up and down completely randomly.

Pair Corralation between Greenland Technologies and Weir Group

If you would invest  1,277  in Weir Group PLC on September 4, 2024 and sell it today you would earn a total of  131.00  from holding Weir Group PLC or generate 10.26% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	1.54%
Values	Daily Returns

Greenland Technologies Holding  vs.  Weir Group PLC

Greenland Technologies

Risk-Adjusted Performance

0 of 100

Very Weak

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

Weir Group PLC

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Weir Group PLC are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, Weir Group may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Greenland Technologies and Weir Group

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

The idea behind Greenland Technologies Holding and Weir Group PLC 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.