Correlation Between Taoping and WM Technology
Can any of the company-specific risk be diversified away by investing in both Taoping and WM 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 Taoping and WM Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Taoping and WM Technology, you can compare the effects of market volatilities on Taoping and WM 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 Taoping with a short position of WM Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Taoping and WM Technology.
Diversification Opportunities for Taoping and WM Technology
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Taoping and MAPSW is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Taoping and WM Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WM Technology and Taoping 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 Taoping are associated (or correlated) with WM Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WM Technology has no effect on the direction of Taoping i.e., Taoping and WM Technology go up and down completely randomly.
Pair Corralation between Taoping and WM Technology
Given the investment horizon of 90 days Taoping is expected to generate 0.44 times more return on investment than WM Technology. However, Taoping is 2.27 times less risky than WM Technology. It trades about -0.06 of its potential returns per unit of risk. WM Technology is currently generating about -0.04 per unit of risk. If you would invest 330.00 in Taoping on August 29, 2025 and sell it today you would lose (97.00) from holding Taoping or give up 29.39% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 98.41% |
| Values | Daily Returns |
Taoping vs. WM Technology
Performance |
| Timeline |
| Taoping |
| WM Technology |
Taoping and WM Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Taoping and WM Technology
The main advantage of trading using opposite Taoping and WM Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Taoping position performs unexpectedly, WM 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 WM Technology will offset losses from the drop in WM Technology's long position.| Taoping vs. Huahui Education Group | Taoping vs. CleanGo Innovations | Taoping vs. Quality Online Education | Taoping vs. New Oriental Education |
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Check out your portfolio center.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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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