Correlation Between WiMi Hologram and Magnite

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

By analyzing existing cross correlation between WiMi Hologram Cloud and Magnite, you can compare the effects of market volatilities on WiMi Hologram and Magnite 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 WiMi Hologram with a short position of Magnite. Check out your portfolio center. Please also check ongoing floating volatility patterns of WiMi Hologram and Magnite.

Diversification Opportunities for WiMi Hologram and Magnite

-0.58

Correlation Coefficient

WiMi Hologram  Magnite

Excellent diversification

The 3 months correlation between WiMi and Magnite is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding WiMi Hologram Cloud and Magnite in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Magnite and WiMi Hologram 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 WiMi Hologram Cloud are associated (or correlated) with Magnite. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Magnite has no effect on the direction of WiMi Hologram i.e., WiMi Hologram and Magnite go up and down completely randomly.

Pair Corralation between WiMi Hologram and Magnite

Given the investment horizon of 90 days WiMi Hologram Cloud is expected to generate 1.8 times more return on investment than Magnite. However, WiMi Hologram is 1.8 times more volatile than Magnite. It trades about 0.04 of its potential returns per unit of risk. Magnite is currently generating about 0.04 per unit of risk. If you would invest  74.00  in WiMi Hologram Cloud on September 20, 2024 and sell it today you would earn a total of  14.00  from holding WiMi Hologram Cloud or generate 18.92% return on investment over 90 days.

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

WiMi Hologram Cloud  vs.  Magnite

WiMi Hologram Cloud

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in WiMi Hologram Cloud are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak primary indicators, WiMi Hologram demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Magnite

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Magnite are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak basic indicators, Magnite demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with WiMi Hologram and Magnite

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

The idea behind WiMi Hologram Cloud and Magnite 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.