Correlation Between WIMFARM SA and FIREWEED METALS

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

By analyzing existing cross correlation between WIMFARM SA EO and FIREWEED METALS P, you can compare the effects of market volatilities on WIMFARM SA and FIREWEED METALS 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 WIMFARM SA with a short position of FIREWEED METALS. Check out your portfolio center. Please also check ongoing floating volatility patterns of WIMFARM SA and FIREWEED METALS.

Diversification Opportunities for WIMFARM SA and FIREWEED METALS

-0.05

Correlation Coefficient

WIMFARM SA  FIREWEED METALS

Good diversification

The 3 months correlation between WIMFARM and FIREWEED is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding WIMFARM SA EO and FIREWEED METALS P in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FIREWEED METALS P and WIMFARM SA 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 WIMFARM SA EO are associated (or correlated) with FIREWEED METALS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FIREWEED METALS P has no effect on the direction of WIMFARM SA i.e., WIMFARM SA and FIREWEED METALS go up and down completely randomly.

Pair Corralation between WIMFARM SA and FIREWEED METALS

Assuming the 90 days horizon WIMFARM SA is expected to generate 2.82 times less return on investment than FIREWEED METALS. But when comparing it to its historical volatility, WIMFARM SA EO is 1.37 times less risky than FIREWEED METALS. It trades about 0.09 of its potential returns per unit of risk. FIREWEED METALS P is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest  117.00  in FIREWEED METALS P on April 25, 2025 and sell it today you would earn a total of  45.00  from holding FIREWEED METALS P or generate 38.46% return on investment over 90 days.

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

WIMFARM SA EO  vs.  FIREWEED METALS P

WIMFARM SA EO

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in WIMFARM SA EO are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, WIMFARM SA may actually be approaching a critical reversion point that can send shares even higher in August 2025.

FIREWEED METALS P

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in FIREWEED METALS P are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, FIREWEED METALS reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with WIMFARM SA and FIREWEED METALS

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

The idea behind WIMFARM SA EO and FIREWEED METALS P 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 Search module to search for actively traded equities including funds and ETFs from over 30 global markets.