Correlation Between WeCommerce Holdings and Bank of New York

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

By analyzing existing cross correlation between WeCommerce Holdings and Bank of New, you can compare the effects of market volatilities on WeCommerce Holdings and Bank of New York 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 WeCommerce Holdings with a short position of Bank of New York. Check out your portfolio center. Please also check ongoing floating volatility patterns of WeCommerce Holdings and Bank of New York.

Diversification Opportunities for WeCommerce Holdings and Bank of New York

0.0

Correlation Coefficient

WeCommerce Holdings  Bank of New York

Pay attention - limited upside

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

Pair Corralation between WeCommerce Holdings and Bank of New York

If you would invest  5,483  in Bank of New on January 20, 2024 and sell it today you would earn a total of  42.00  from holding Bank of New or generate 0.77% return on investment over 90 days.

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

WeCommerce Holdings  vs.  Bank of New

WeCommerce Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

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

Bank of New York

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Bank of New are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent forward-looking signals, Bank of New York is not utilizing all of its potentials. The newest stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with WeCommerce Holdings and Bank of New York

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

The idea behind WeCommerce Holdings and Bank of New 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.