Correlation Between Wetouch Technology and Modiv

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

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

Diversification Opportunities for Wetouch Technology and Modiv

-0.39

Correlation Coefficient

Wetouch Technology  Modiv

Very good diversification

The 3 months correlation between Wetouch and Modiv is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Wetouch Technology Common and Modiv Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Modiv Inc and Wetouch Technology 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 Wetouch Technology Common are associated (or correlated) with Modiv. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Modiv Inc has no effect on the direction of Wetouch Technology i.e., Wetouch Technology and Modiv go up and down completely randomly.

Pair Corralation between Wetouch Technology and Modiv

Given the investment horizon of 90 days Wetouch Technology Common is expected to under-perform the Modiv. In addition to that, Wetouch Technology is 6.01 times more volatile than Modiv Inc. It trades about -0.04 of its total potential returns per unit of risk. Modiv Inc is currently generating about 0.03 per unit of volatility. If you would invest  2,418  in Modiv Inc on May 7, 2025 and sell it today you would earn a total of  21.00  from holding Modiv Inc or generate 0.87% return on investment over 90 days.

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

Wetouch Technology Common  vs.  Modiv Inc

Wetouch Technology Common

Risk-Adjusted Performance

Weakest

Over the last 90 days Wetouch Technology Common has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest uncertain performance, the Stock's basic indicators remain strong and the recent confusion on Wall Street may also be a sign of long-lasting gains for the firm traders.

Modiv Inc

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Modiv Inc are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Modiv is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Wetouch Technology and Modiv

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

The idea behind Wetouch Technology Common and Modiv Inc 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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.