Correlation Between TriMas and Meiwu Technology

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

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

Diversification Opportunities for TriMas and Meiwu Technology

-0.48

Correlation Coefficient

TriMas  Meiwu Technology

Very good diversification

The 3 months correlation between TriMas and Meiwu is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding TriMas and Meiwu Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Meiwu Technology and TriMas 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 TriMas 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 TriMas i.e., TriMas and Meiwu Technology go up and down completely randomly.

Pair Corralation between TriMas and Meiwu Technology

Considering the 90-day investment horizon TriMas is expected to generate 0.17 times more return on investment than Meiwu Technology. However, TriMas is 5.91 times less risky than Meiwu Technology. It trades about 0.0 of its potential returns per unit of risk. Meiwu Technology Co is currently generating about -0.02 per unit of risk. If you would invest  2,620  in TriMas on August 19, 2024 and sell it today you would lose (66.00) from holding TriMas or give up 2.52% of portfolio value over 90 days.

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

TriMas  vs.  Meiwu Technology Co

TriMas

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in TriMas are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively abnormal basic indicators, TriMas may actually be approaching a critical reversion point that can send shares even higher in December 2024.

Meiwu Technology

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Meiwu Technology Co are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Meiwu Technology may actually be approaching a critical reversion point that can send shares even higher in December 2024.

Pair Trading with TriMas and Meiwu Technology

The main advantage of trading using opposite TriMas and Meiwu Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TriMas 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 TriMas 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.

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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.