Correlation Between Yamaha and Weir

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

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

Diversification Opportunities for Yamaha and Weir

0.0

Correlation Coefficient

Yamaha  Weir

Pay attention - limited upside

The 3 months correlation between Yamaha and Weir is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Yamaha and The Weir Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Weir Group and Yamaha 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 Yamaha are associated (or correlated) with Weir. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Weir Group has no effect on the direction of Yamaha i.e., Yamaha and Weir go up and down completely randomly.

Pair Corralation between Yamaha and Weir

If you would invest (100.00) in The Weir Group on May 7, 2025 and sell it today you would earn a total of  100.00  from holding The Weir Group or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Yamaha  vs.  The Weir Group

Yamaha

Risk-Adjusted Performance

Weakest

Over the last 90 days Yamaha has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest uncertain performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Weir Group

Risk-Adjusted Performance

Mild

Over the last 90 days The Weir Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Weir is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Yamaha and Weir

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

The idea behind Yamaha and The Weir Group 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.