Correlation Between WESTLIFE FOODWORLD and Kingfa Science
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By analyzing existing cross correlation between WESTLIFE FOODWORLD LIMITED and Kingfa Science Technology, you can compare the effects of market volatilities on WESTLIFE FOODWORLD and Kingfa Science 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 WESTLIFE FOODWORLD with a short position of Kingfa Science. Check out your portfolio center. Please also check ongoing floating volatility patterns of WESTLIFE FOODWORLD and Kingfa Science.
Diversification Opportunities for WESTLIFE FOODWORLD and Kingfa Science
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between WESTLIFE and Kingfa is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding WESTLIFE FOODWORLD LIMITED and Kingfa Science Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kingfa Science Technology and WESTLIFE FOODWORLD 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 WESTLIFE FOODWORLD LIMITED are associated (or correlated) with Kingfa Science. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kingfa Science Technology has no effect on the direction of WESTLIFE FOODWORLD i.e., WESTLIFE FOODWORLD and Kingfa Science go up and down completely randomly.
Pair Corralation between WESTLIFE FOODWORLD and Kingfa Science
Assuming the 90 days trading horizon WESTLIFE FOODWORLD LIMITED is expected to generate 1.0 times more return on investment than Kingfa Science. However, WESTLIFE FOODWORLD is 1.0 times more volatile than Kingfa Science Technology. It trades about 0.02 of its potential returns per unit of risk. Kingfa Science Technology is currently generating about -0.03 per unit of risk. If you would invest 79,935 in WESTLIFE FOODWORLD LIMITED on September 8, 2024 and sell it today you would earn a total of 1,570 from holding WESTLIFE FOODWORLD LIMITED or generate 1.96% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
WESTLIFE FOODWORLD LIMITED vs. Kingfa Science Technology
Performance |
Timeline |
WESTLIFE FOODWORLD |
Kingfa Science Technology |
WESTLIFE FOODWORLD and Kingfa Science Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with WESTLIFE FOODWORLD and Kingfa Science
The main advantage of trading using opposite WESTLIFE FOODWORLD and Kingfa Science positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WESTLIFE FOODWORLD position performs unexpectedly, Kingfa Science 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 Kingfa Science will offset losses from the drop in Kingfa Science's long position.WESTLIFE FOODWORLD vs. Ami Organics Limited | WESTLIFE FOODWORLD vs. Dodla Dairy Limited | WESTLIFE FOODWORLD vs. Fairchem Organics Limited | WESTLIFE FOODWORLD vs. Mangalam Organics Limited |
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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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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