Correlation Between Simt Large and Wabmsx

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

By analyzing existing cross correlation between Simt Large Cap and Wabmsx, you can compare the effects of market volatilities on Simt Large and Wabmsx 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 Simt Large with a short position of Wabmsx. Check out your portfolio center. Please also check ongoing floating volatility patterns of Simt Large and Wabmsx.

Diversification Opportunities for Simt Large and Wabmsx

1.0

Correlation Coefficient

Simt Large  Wabmsx

No risk reduction

The 3 months correlation between Simt and Wabmsx is 1.0. Overlapping area represents the amount of risk that can be diversified away by holding Simt Large Cap and Wabmsx in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wabmsx and Simt Large 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 Simt Large Cap are associated (or correlated) with Wabmsx. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wabmsx has no effect on the direction of Simt Large i.e., Simt Large and Wabmsx go up and down completely randomly.

Pair Corralation between Simt Large and Wabmsx

Assuming the 90 days horizon Simt Large is expected to generate 1.37 times less return on investment than Wabmsx. In addition to that, Simt Large is 1.08 times more volatile than Wabmsx. It trades about 0.05 of its total potential returns per unit of risk. Wabmsx is currently generating about 0.07 per unit of volatility. If you would invest  1,571  in Wabmsx on April 30, 2025 and sell it today you would earn a total of  183.00  from holding Wabmsx or generate 11.65% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	70.24%
Values	Daily Returns

Simt Large Cap  vs.  Wabmsx

Simt Large Cap

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Simt Large Cap are ranked lower than 23 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak fundamental indicators, Simt Large showed solid returns over the last few months and may actually be approaching a breakup point.

Wabmsx

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Wabmsx are ranked lower than 23 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak fundamental drivers, Wabmsx may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Simt Large and Wabmsx

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

The idea behind Simt Large Cap and Wabmsx 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.