Correlation Between Meiwu Technology and Osaka Steel

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

By analyzing existing cross correlation between Meiwu Technology Co and Osaka Steel Co,, you can compare the effects of market volatilities on Meiwu Technology and Osaka Steel 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 Meiwu Technology with a short position of Osaka Steel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Meiwu Technology and Osaka Steel.

Diversification Opportunities for Meiwu Technology and Osaka Steel

0.0

Correlation Coefficient

Meiwu Technology  Osaka Steel

Pay attention - limited upside

The 3 months correlation between Meiwu and Osaka is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Meiwu Technology Co and Osaka Steel Co, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Osaka Steel Co, and Meiwu Technology 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 Meiwu Technology Co are associated (or correlated) with Osaka Steel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Osaka Steel Co, has no effect on the direction of Meiwu Technology i.e., Meiwu Technology and Osaka Steel go up and down completely randomly.

Pair Corralation between Meiwu Technology and Osaka Steel

Considering the 90-day investment horizon Meiwu Technology Co is expected to under-perform the Osaka Steel. In addition to that, Meiwu Technology is 174.19 times more volatile than Osaka Steel Co,. It trades about -0.01 of its total potential returns per unit of risk. Osaka Steel Co, is currently generating about 0.06 per unit of volatility. If you would invest  1,003  in Osaka Steel Co, on October 22, 2024 and sell it today you would earn a total of  17.00  from holding Osaka Steel Co, or generate 1.69% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	99.8%
Values	Daily Returns

Meiwu Technology Co  vs.  Osaka Steel Co,

Meiwu Technology

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Meiwu Technology Co are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of fairly uncertain basic indicators, Meiwu Technology showed solid returns over the last few months and may actually be approaching a breakup point.

Osaka Steel Co,

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Osaka Steel Co, has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Osaka Steel is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Meiwu Technology and Osaka Steel

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

The idea behind Meiwu Technology Co and Osaka Steel Co, 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.