Correlation Between Wealthsimple Shariah and ChitogenX

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

By analyzing existing cross correlation between Wealthsimple Shariah World and ChitogenX, you can compare the effects of market volatilities on Wealthsimple Shariah and ChitogenX 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 Wealthsimple Shariah with a short position of ChitogenX. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wealthsimple Shariah and ChitogenX.

Diversification Opportunities for Wealthsimple Shariah and ChitogenX

-0.14

Correlation Coefficient

Wealthsimple Shariah  ChitogenX

Good diversification

The 3 months correlation between Wealthsimple and ChitogenX is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Wealthsimple Shariah World and ChitogenX in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ChitogenX and Wealthsimple Shariah 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 Wealthsimple Shariah World are associated (or correlated) with ChitogenX. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ChitogenX has no effect on the direction of Wealthsimple Shariah i.e., Wealthsimple Shariah and ChitogenX go up and down completely randomly.

Pair Corralation between Wealthsimple Shariah and ChitogenX

Assuming the 90 days trading horizon Wealthsimple Shariah World is expected to generate 0.07 times more return on investment than ChitogenX. However, Wealthsimple Shariah World is 14.15 times less risky than ChitogenX. It trades about 0.03 of its potential returns per unit of risk. ChitogenX is currently generating about -0.12 per unit of risk. If you would invest  3,204  in Wealthsimple Shariah World on August 26, 2025 and sell it today you would earn a total of  34.00  from holding Wealthsimple Shariah World or generate 1.06% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	96.92%
Values	Daily Returns

Wealthsimple Shariah World  vs.  ChitogenX

Wealthsimple Shariah

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Wealthsimple Shariah World are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound technical and fundamental indicators, Wealthsimple Shariah is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.

ChitogenX

Risk-Adjusted Performance

Weakest

Over the last 90 days ChitogenX has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in December 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Wealthsimple Shariah and ChitogenX

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

The idea behind Wealthsimple Shariah World and ChitogenX 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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.