Correlation Between WiMi Hologram and Shorepower Technologies

Can any of the company-specific risk be diversified away by investing in both WiMi Hologram and Shorepower Technologies 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 Shorepower Technologies 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 Shorepower Technologies, you can compare the effects of market volatilities on WiMi Hologram and Shorepower Technologies 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 Shorepower Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of WiMi Hologram and Shorepower Technologies.

Diversification Opportunities for WiMi Hologram and Shorepower Technologies

-0.29

Correlation Coefficient

WiMi Hologram  Shorepower Technologies

Very good diversification

The 3 months correlation between WiMi and Shorepower is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding WiMi Hologram Cloud and Shorepower Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shorepower Technologies 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 Shorepower Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shorepower Technologies has no effect on the direction of WiMi Hologram i.e., WiMi Hologram and Shorepower Technologies go up and down completely randomly.

Pair Corralation between WiMi Hologram and Shorepower Technologies

Given the investment horizon of 90 days WiMi Hologram is expected to generate 91.38 times less return on investment than Shorepower Technologies. But when comparing it to its historical volatility, WiMi Hologram Cloud is 4.45 times less risky than Shorepower Technologies. It trades about 0.0 of its potential returns per unit of risk. Shorepower Technologies is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest  3.50  in Shorepower Technologies on September 15, 2024 and sell it today you would earn a total of  1.00  from holding Shorepower Technologies or generate 28.57% return on investment over 90 days.

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

WiMi Hologram Cloud  vs.  Shorepower Technologies

WiMi Hologram Cloud

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days WiMi Hologram Cloud has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong primary indicators, WiMi Hologram is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

Shorepower Technologies

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Shorepower Technologies are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak technical and fundamental indicators, Shorepower Technologies showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with WiMi Hologram and Shorepower Technologies

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

The idea behind WiMi Hologram Cloud and Shorepower Technologies 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.