Correlation Between SPS Commerce and WeRide American

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

By analyzing existing cross correlation between SPS Commerce and WeRide American Depositary, you can compare the effects of market volatilities on SPS Commerce and WeRide American 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 SPS Commerce with a short position of WeRide American. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPS Commerce and WeRide American.

Diversification Opportunities for SPS Commerce and WeRide American

0.47

Correlation Coefficient

SPS Commerce  WeRide American

Very weak diversification

The 3 months correlation between SPS and WeRide is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding SPS Commerce and WeRide American Depositary in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WeRide American Depo and SPS Commerce 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 SPS Commerce are associated (or correlated) with WeRide American. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WeRide American Depo has no effect on the direction of SPS Commerce i.e., SPS Commerce and WeRide American go up and down completely randomly.

Pair Corralation between SPS Commerce and WeRide American

Given the investment horizon of 90 days SPS Commerce is expected to under-perform the WeRide American. But the stock apears to be less risky and, when comparing its historical volatility, SPS Commerce is 1.56 times less risky than WeRide American. The stock trades about -0.15 of its potential returns per unit of risk. The WeRide American Depositary is currently generating about -0.08 of returns per unit of risk over similar time horizon. If you would invest  989.00  in WeRide American Depositary on August 18, 2025 and sell it today you would lose (286.00) from holding WeRide American Depositary or give up 28.92% of portfolio value over 90 days.

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

SPS Commerce  vs.  WeRide American Depositary

SPS Commerce

Risk-Adjusted Performance

Weakest

Over the last 90 days SPS Commerce has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of conflicting performance in the last few months, the Stock's basic indicators remain rather sound which may send shares a bit higher in December 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

WeRide American Depo

Risk-Adjusted Performance

Weakest

Over the last 90 days WeRide American Depositary has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's basic indicators remain rather sound which may send shares a bit higher in December 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Pair Trading with SPS Commerce and WeRide American

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

The idea behind SPS Commerce and WeRide American Depositary 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.