Correlation Between Wang Lee and Ihuman

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

By analyzing existing cross correlation between Wang Lee Group, and Ihuman Inc, you can compare the effects of market volatilities on Wang Lee and Ihuman 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 Wang Lee with a short position of Ihuman. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wang Lee and Ihuman.

Diversification Opportunities for Wang Lee and Ihuman

-0.69

Correlation Coefficient

Wang Lee  Ihuman

Excellent diversification

The 3 months correlation between Wang and Ihuman is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Wang Lee Group, and Ihuman Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ihuman Inc and Wang Lee 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 Wang Lee Group, are associated (or correlated) with Ihuman. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ihuman Inc has no effect on the direction of Wang Lee i.e., Wang Lee and Ihuman go up and down completely randomly.

Pair Corralation between Wang Lee and Ihuman

Given the investment horizon of 90 days Wang Lee Group, is expected to generate 3.21 times more return on investment than Ihuman. However, Wang Lee is 3.21 times more volatile than Ihuman Inc. It trades about 0.06 of its potential returns per unit of risk. Ihuman Inc is currently generating about -0.03 per unit of risk. If you would invest  130.00  in Wang Lee Group, on October 4, 2024 and sell it today you would earn a total of  46.50  from holding Wang Lee Group, or generate 35.77% return on investment over 90 days.

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

Wang Lee Group,  vs.  Ihuman Inc

Wang Lee Group,

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Wang Lee Group, are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady technical and fundamental indicators, Wang Lee unveiled solid returns over the last few months and may actually be approaching a breakup point.

Ihuman Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ihuman Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's technical 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.

Pair Trading with Wang Lee and Ihuman

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

The idea behind Wang Lee Group, and Ihuman Inc 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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.