Correlation Between Weyco and Global E

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

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

Diversification Opportunities for Weyco and Global E

0.32

Correlation Coefficient

Weyco  Global E

Weak diversification

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

Pair Corralation between Weyco and Global E

Given the investment horizon of 90 days Weyco is expected to generate 5.51 times less return on investment than Global E. In addition to that, Weyco is 1.37 times more volatile than Global E Online. It trades about 0.04 of its total potential returns per unit of risk. Global E Online is currently generating about 0.29 per unit of volatility. If you would invest  3,780  in Global E Online on September 17, 2024 and sell it today you would earn a total of  1,946  from holding Global E Online or generate 51.47% return on investment over 90 days.

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

Weyco Group  vs.  Global E Online

Weyco Group

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Weyco Group are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unfluctuating basic indicators, Weyco may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Global E Online

Risk-Adjusted Performance

22 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Global E Online are ranked lower than 22 (%) of all global equities and portfolios over the last 90 days. In spite of rather unfluctuating fundamental drivers, Global E exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Weyco and Global E

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

The idea behind Weyco Group and Global E Online 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.

Check out your portfolio center.

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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.