Correlation Between O I and WEBUY GLOBAL

Can any of the company-specific risk be diversified away by investing in both O I and WEBUY GLOBAL 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 O I and WEBUY GLOBAL into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between O I Glass and WEBUY GLOBAL LTD, you can compare the effects of market volatilities on O I and WEBUY GLOBAL 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 O I with a short position of WEBUY GLOBAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of O I and WEBUY GLOBAL.

Diversification Opportunities for O I and WEBUY GLOBAL

-0.12

Correlation Coefficient

O I  WEBUY GLOBAL

Good diversification

The 3 months correlation between O I and WEBUY is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding O I Glass and WEBUY GLOBAL LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WEBUY GLOBAL LTD and O I 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 O I Glass are associated (or correlated) with WEBUY GLOBAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WEBUY GLOBAL LTD has no effect on the direction of O I i.e., O I and WEBUY GLOBAL go up and down completely randomly.

Pair Corralation between O I and WEBUY GLOBAL

Allowing for the 90-day total investment horizon O I Glass is expected to under-perform the WEBUY GLOBAL. But the stock apears to be less risky and, when comparing its historical volatility, O I Glass is 4.2 times less risky than WEBUY GLOBAL. The stock trades about -0.33 of its potential returns per unit of risk. The WEBUY GLOBAL LTD is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest  19.00  in WEBUY GLOBAL LTD on October 4, 2024 and sell it today you would lose (1.70) from holding WEBUY GLOBAL LTD or give up 8.95% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

O I Glass  vs.  WEBUY GLOBAL LTD

O I Glass

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days O I Glass has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's forward indicators remain fairly strong which may send shares a bit higher in February 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

WEBUY GLOBAL LTD

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in WEBUY GLOBAL LTD are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of fairly uncertain basic indicators, WEBUY GLOBAL showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with O I and WEBUY GLOBAL

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

The idea behind O I Glass and WEBUY GLOBAL LTD 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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.