Correlation Between Top KingWin and Mercurity Fintech

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

By analyzing existing cross correlation between Top KingWin and Mercurity Fintech Holding, you can compare the effects of market volatilities on Top KingWin and Mercurity Fintech 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 Top KingWin with a short position of Mercurity Fintech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Top KingWin and Mercurity Fintech.

Diversification Opportunities for Top KingWin and Mercurity Fintech

-0.29

Correlation Coefficient

Top KingWin  Mercurity Fintech

Very good diversification

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

Pair Corralation between Top KingWin and Mercurity Fintech

Considering the 90-day investment horizon Top KingWin is expected to under-perform the Mercurity Fintech. In addition to that, Top KingWin is 1.15 times more volatile than Mercurity Fintech Holding. It trades about 0.0 of its total potential returns per unit of risk. Mercurity Fintech Holding is currently generating about 0.24 per unit of volatility. If you would invest  338.00  in Mercurity Fintech Holding on September 13, 2024 and sell it today you would earn a total of  302.00  from holding Mercurity Fintech Holding or generate 89.35% return on investment over 90 days.

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

Top KingWin  vs.  Mercurity Fintech Holding

Top KingWin

Risk-Adjusted Performance

4 of 100

Modest

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

Mercurity Fintech Holding

Risk-Adjusted Performance

17 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Mercurity Fintech Holding are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. Despite fairly conflicting technical and fundamental indicators, Mercurity Fintech demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Top KingWin and Mercurity Fintech

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

The idea behind Top KingWin and Mercurity Fintech Holding 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.