Correlation Between E Home and Meiwu Technology

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

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

Diversification Opportunities for E Home and Meiwu Technology

0.64

Correlation Coefficient

E Home  Meiwu Technology

Poor diversification

The 3 months correlation between EJH and Meiwu is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding E Home Household Service and Meiwu Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Meiwu Technology and E Home 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 E Home Household Service are associated (or correlated) with Meiwu Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Meiwu Technology has no effect on the direction of E Home i.e., E Home and Meiwu Technology go up and down completely randomly.

Pair Corralation between E Home and Meiwu Technology

Considering the 90-day investment horizon E Home Household Service is expected to under-perform the Meiwu Technology. In addition to that, E Home is 4.52 times more volatile than Meiwu Technology Co. It trades about -0.2 of its total potential returns per unit of risk. Meiwu Technology Co is currently generating about -0.02 per unit of volatility. If you would invest  181.00  in Meiwu Technology Co on May 5, 2025 and sell it today you would lose (3.00) from holding Meiwu Technology Co or give up 1.66% of portfolio value over 90 days.

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

E Home Household Service  vs.  Meiwu Technology Co

E Home Household

Risk-Adjusted Performance

Very Weak

Over the last 90 days E Home Household Service 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 forward-looking indicators remain fairly strong which may send shares a bit higher in September 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Meiwu Technology

Risk-Adjusted Performance

Very Weak

Over the last 90 days Meiwu Technology Co has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest fragile performance, the Stock's basic indicators remain stable and the latest fuss on Wall Street may also be a sign of long-term gains for the venture sophisticated investors.

Pair Trading with E Home and Meiwu Technology

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

The idea behind E Home Household Service and Meiwu Technology 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.