Correlation Between InMode and Wilmar International
Can any of the company-specific risk be diversified away by investing in both InMode and Wilmar International 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 InMode and Wilmar International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between InMode and Wilmar International, you can compare the effects of market volatilities on InMode and Wilmar International 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 InMode with a short position of Wilmar International. Check out your portfolio center. Please also check ongoing floating volatility patterns of InMode and Wilmar International.
Diversification Opportunities for InMode and Wilmar International
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between InMode and Wilmar is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding InMode and Wilmar International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wilmar International and InMode 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 InMode are associated (or correlated) with Wilmar International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wilmar International has no effect on the direction of InMode i.e., InMode and Wilmar International go up and down completely randomly.
Pair Corralation between InMode and Wilmar International
Given the investment horizon of 90 days InMode is expected to generate 1.02 times more return on investment than Wilmar International. However, InMode is 1.02 times more volatile than Wilmar International. It trades about 0.33 of its potential returns per unit of risk. Wilmar International is currently generating about 0.15 per unit of risk. If you would invest 1,667 in InMode on December 4, 2024 and sell it today you would earn a total of 222.00 from holding InMode or generate 13.32% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
InMode vs. Wilmar International
Performance |
Timeline |
InMode |
Wilmar International |
InMode and Wilmar International Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with InMode and Wilmar International
The main advantage of trading using opposite InMode and Wilmar International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if InMode position performs unexpectedly, Wilmar International 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 Wilmar International will offset losses from the drop in Wilmar International's long position.InMode vs. TransMedics Group | InMode vs. Inspire Medical Systems | InMode vs. Insulet | InMode vs. DexCom Inc |
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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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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