Correlation Between Hf Foods and Meiwu Technology

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

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

Diversification Opportunities for Hf Foods and Meiwu Technology

-0.73

Correlation Coefficient

Hf Foods  Meiwu Technology

Pay attention - limited upside

The 3 months correlation between HFFG and Meiwu is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding Hf Foods Group and Meiwu Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Meiwu Technology and Hf Foods 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 Hf Foods Group are associated (or correlated) with Meiwu Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Meiwu Technology has no effect on the direction of Hf Foods i.e., Hf Foods and Meiwu Technology go up and down completely randomly.

Pair Corralation between Hf Foods and Meiwu Technology

Given the investment horizon of 90 days Hf Foods Group is expected to under-perform the Meiwu Technology. But the stock apears to be less risky and, when comparing its historical volatility, Hf Foods Group is 4.82 times less risky than Meiwu Technology. The stock trades about -0.08 of its potential returns per unit of risk. The Meiwu Technology Co is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest  161.00  in Meiwu Technology Co on February 2, 2025 and sell it today you would earn a total of  62.00  from holding Meiwu Technology Co or generate 38.51% return on investment over 90 days.

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

Hf Foods Group  vs.  Meiwu Technology Co

Hf Foods Group

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Hf Foods Group are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite nearly inconsistent technical and fundamental indicators, Hf Foods reported solid returns over the last few months and may actually be approaching a breakup point.

Meiwu Technology

Risk-Adjusted Performance

Very Weak

Over the last 90 days Meiwu Technology Co has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly uncertain basic indicators, Meiwu Technology may actually be approaching a critical reversion point that can send shares even higher in June 2025.

Pair Trading with Hf Foods and Meiwu Technology

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

The idea behind Hf Foods Group and Meiwu Technology Co 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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.