Correlation Between Warner Music and Wenzhou Kangning
Can any of the company-specific risk be diversified away by investing in both Warner Music and Wenzhou Kangning 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 Warner Music and Wenzhou Kangning into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Warner Music Group and Wenzhou Kangning Hospital, you can compare the effects of market volatilities on Warner Music and Wenzhou Kangning 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 Warner Music with a short position of Wenzhou Kangning. Check out your portfolio center. Please also check ongoing floating volatility patterns of Warner Music and Wenzhou Kangning.
Diversification Opportunities for Warner Music and Wenzhou Kangning
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Warner and Wenzhou is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Warner Music Group and Wenzhou Kangning Hospital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wenzhou Kangning Hospital and Warner Music 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 Warner Music Group are associated (or correlated) with Wenzhou Kangning. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wenzhou Kangning Hospital has no effect on the direction of Warner Music i.e., Warner Music and Wenzhou Kangning go up and down completely randomly.
Pair Corralation between Warner Music and Wenzhou Kangning
Assuming the 90 days horizon Warner Music Group is expected to under-perform the Wenzhou Kangning. But the stock apears to be less risky and, when comparing its historical volatility, Warner Music Group is 2.69 times less risky than Wenzhou Kangning. The stock trades about -0.18 of its potential returns per unit of risk. The Wenzhou Kangning Hospital is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 116.00 in Wenzhou Kangning Hospital on September 12, 2025 and sell it today you would earn a total of 3.00 from holding Wenzhou Kangning Hospital or generate 2.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Warner Music Group vs. Wenzhou Kangning Hospital
Performance |
| Timeline |
| Warner Music Group |
| Wenzhou Kangning Hospital |
Warner Music and Wenzhou Kangning Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Warner Music and Wenzhou Kangning
The main advantage of trading using opposite Warner Music and Wenzhou Kangning positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Warner Music position performs unexpectedly, Wenzhou Kangning 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 Wenzhou Kangning will offset losses from the drop in Wenzhou Kangning's long position.| Warner Music vs. Netflix | Warner Music vs. CTS Eventim AG | Warner Music vs. Origin Agritech | Warner Music vs. SIVERS SEMICONDUCTORS AB |
| Wenzhou Kangning vs. Apple Inc | Wenzhou Kangning vs. Apple Inc | Wenzhou Kangning vs. Apple Inc | Wenzhou Kangning vs. Apple Inc |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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