Correlation Between WiMi Hologram and InFintT Acquisition

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Can any of the company-specific risk be diversified away by investing in both WiMi Hologram and InFintT Acquisition 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 WiMi Hologram and InFintT Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WiMi Hologram Cloud and InFintT Acquisition Corp, you can compare the effects of market volatilities on WiMi Hologram and InFintT Acquisition 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 WiMi Hologram with a short position of InFintT Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of WiMi Hologram and InFintT Acquisition.

Diversification Opportunities for WiMi Hologram and InFintT Acquisition

0.56
  Correlation Coefficient

Very weak diversification

The 3 months correlation between WiMi and InFintT is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding WiMi Hologram Cloud and InFintT Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on InFintT Acquisition Corp and WiMi Hologram 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 WiMi Hologram Cloud are associated (or correlated) with InFintT Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of InFintT Acquisition Corp has no effect on the direction of WiMi Hologram i.e., WiMi Hologram and InFintT Acquisition go up and down completely randomly.

Pair Corralation between WiMi Hologram and InFintT Acquisition

Given the investment horizon of 90 days WiMi Hologram Cloud is expected to generate 95.03 times more return on investment than InFintT Acquisition. However, WiMi Hologram is 95.03 times more volatile than InFintT Acquisition Corp. It trades about 0.25 of its potential returns per unit of risk. InFintT Acquisition Corp is currently generating about 0.06 per unit of risk. If you would invest  63.00  in WiMi Hologram Cloud on December 3, 2023 and sell it today you would earn a total of  46.00  from holding WiMi Hologram Cloud or generate 73.02% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

WiMi Hologram Cloud  vs.  InFintT Acquisition Corp

 Performance 
       Timeline  
WiMi Hologram Cloud 

Risk-Adjusted Performance

10 of 100

 
Low
 
High
OK
Compared to the overall equity markets, risk-adjusted returns on investments in WiMi Hologram Cloud are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite fairly abnormal primary indicators, WiMi Hologram demonstrated solid returns over the last few months and may actually be approaching a breakup point.
InFintT Acquisition Corp 

Risk-Adjusted Performance

12 of 100

 
Low
 
High
Good
Compared to the overall equity markets, risk-adjusted returns on investments in InFintT Acquisition Corp are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy forward indicators, InFintT Acquisition is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

WiMi Hologram and InFintT Acquisition Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with WiMi Hologram and InFintT Acquisition

The main advantage of trading using opposite WiMi Hologram and InFintT Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WiMi Hologram position performs unexpectedly, InFintT Acquisition 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 InFintT Acquisition will offset losses from the drop in InFintT Acquisition's long position.
The idea behind WiMi Hologram Cloud and InFintT Acquisition Corp 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.

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