Correlation Between Wheaton Precious and Heavitree Brewery

Can any of the company-specific risk be diversified away by investing in both Wheaton Precious and Heavitree Brewery 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 Wheaton Precious and Heavitree Brewery into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Wheaton Precious Metals and Heavitree Brewery, you can compare the effects of market volatilities on Wheaton Precious and Heavitree Brewery 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 Wheaton Precious with a short position of Heavitree Brewery. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wheaton Precious and Heavitree Brewery.

Diversification Opportunities for Wheaton Precious and Heavitree Brewery

0.36

Correlation Coefficient

Wheaton Precious  Heavitree Brewery

Weak diversification

The 3 months correlation between Wheaton and Heavitree is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Wheaton Precious Metals and Heavitree Brewery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Heavitree Brewery and Wheaton Precious 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 Wheaton Precious Metals are associated (or correlated) with Heavitree Brewery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Heavitree Brewery has no effect on the direction of Wheaton Precious i.e., Wheaton Precious and Heavitree Brewery go up and down completely randomly.

Pair Corralation between Wheaton Precious and Heavitree Brewery

Assuming the 90 days trading horizon Wheaton Precious Metals is expected to generate 12.68 times more return on investment than Heavitree Brewery. However, Wheaton Precious is 12.68 times more volatile than Heavitree Brewery. It trades about 0.09 of its potential returns per unit of risk. Heavitree Brewery is currently generating about 0.13 per unit of risk. If you would invest  612,820  in Wheaton Precious Metals on April 23, 2025 and sell it today you would earn a total of  70,180  from holding Wheaton Precious Metals or generate 11.45% return on investment over 90 days.

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

Wheaton Precious Metals  vs.  Heavitree Brewery

Wheaton Precious Metals

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Wheaton Precious Metals are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain technical and fundamental indicators, Wheaton Precious may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Heavitree Brewery

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Heavitree Brewery are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound technical and fundamental indicators, Heavitree Brewery is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Wheaton Precious and Heavitree Brewery

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

The idea behind Wheaton Precious Metals and Heavitree Brewery 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.