Correlation Between Volcon and WeTrade Group

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

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

Diversification Opportunities for Volcon and WeTrade Group

-0.32

Correlation Coefficient

Volcon  WeTrade Group

Very good diversification

The 3 months correlation between Volcon and WeTrade is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Volcon Inc and WeTrade Group Ordinary in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WeTrade Group Ordinary and Volcon 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 Volcon Inc are associated (or correlated) with WeTrade Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WeTrade Group Ordinary has no effect on the direction of Volcon i.e., Volcon and WeTrade Group go up and down completely randomly.

Pair Corralation between Volcon and WeTrade Group

If you would invest (100.00) in WeTrade Group Ordinary on September 12, 2024 and sell it today you would earn a total of  100.00  from holding WeTrade Group Ordinary or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Volcon Inc  vs.  WeTrade Group Ordinary

Volcon Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Volcon Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's fundamental indicators remain very healthy which may send shares a bit higher in January 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

WeTrade Group Ordinary

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Volcon and WeTrade Group

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

The idea behind Volcon Inc and WeTrade Group Ordinary 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.