Watsco Correlations

WSO Stock

USD 483.69 7.19 1.51%

The current 90-days correlation between Watsco Inc and Fastenal Company is 0.63 (i.e., Poor diversification). A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as Watsco moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if Watsco Inc moves in either direction, the perfectly negatively correlated security will move in the opposite direction.

Watsco Correlation With Market

Weak diversification

The correlation between Watsco Inc and DJI is 0.34 (i.e., Weak diversification) for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding Watsco Inc and DJI in the same portfolio, assuming nothing else is changed.

Check out Your Current Watchlist to better understand how to build diversified portfolios, which includes a position in Watsco Inc. Also, note that the market value of any company could be closely tied with the direction of predictive economic indicators such as signals in state.

Moving together with Watsco Stock

0.83	DSGR	Distribution Solutions	Pair Corr
0.96	FAST	Fastenal Sell-off Trend	Pair Corr
0.91	FERG	Ferguson Plc	Pair Corr
0.78	AIT	Applied Industrial	Pair Corr
0.94	BXC	BlueLinx Holdings Earnings Call This Week	Pair Corr
0.82	EVI	EVI Industries	Pair Corr
0.95	GIC	Global Industrial	Pair Corr
0.95	GWW	WW Grainger	Pair Corr
0.68	MSM	MSC Industrial Direct	Pair Corr
0.89	WCC	WESCO International	Pair Corr
0.9	POOL	Pool Earnings Call This Week	Pair Corr
0.82	SITE	SiteOne Landscape Supply	Pair Corr
0.61	J	Jacobs Solutions	Pair Corr
0.76	R	Ryder System Earnings Call This Week	Pair Corr
0.73	AL	Air Lease Buyout Trend	Pair Corr
0.73	BV	BrightView Holdings	Pair Corr
0.7	BW	Babcock Wilcox Enter	Pair Corr
0.73	CR	Crane Company	Pair Corr
0.66	CW	Curtiss Wright	Pair Corr
0.75	GD	General Dynamics	Pair Corr

Moving against Watsco Stock

0.82	BA	Boeing	Pair Corr
0.78	B	Barnes Group	Pair Corr
0.68	DXPE	DXP Enterprises	Pair Corr
0.67	WCC-PA	WESCO International	Pair Corr
0.53	AP	Ampco Pittsburgh	Pair Corr
0.55	PL	Planet Labs PBC	Pair Corr
0.42	BZ	Kanzhun Ltd ADR	Pair Corr
0.31	EH	Ehang Holdings	Pair Corr

Related Correlations Analysis

	FAST	SITE	FERG	GWW	POOL	MSM	AIT	CNM	DXPE
FAST		0.79	0.94	0.93	0.86	0.74	0.84	-0.6	-0.69	FAST
SITE	0.79		0.81	0.8	0.88	0.78	0.8	-0.13	-0.25	SITE
FERG	0.94	0.81		0.86	0.85	0.68	0.86	-0.44	-0.63	FERG
GWW	0.93	0.8	0.86		0.88	0.7	0.71	-0.54	-0.68	GWW
POOL	0.86	0.88	0.85	0.88		0.59	0.72	-0.28	-0.54	POOL
MSM	0.74	0.78	0.68	0.7	0.59		0.85	-0.26	-0.18	MSM
AIT	0.84	0.8	0.86	0.71	0.72	0.85		-0.24	-0.29	AIT
CNM	-0.6	-0.13	-0.44	-0.54	-0.28	-0.26	-0.24		0.81	CNM
DXPE	-0.69	-0.25	-0.63	-0.68	-0.54	-0.18	-0.29	0.81		DXPE
	FAST	SITE	FERG	GWW	POOL	MSM	AIT	CNM	DXPE

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Correlation Matchups

Over a given time period, the two securities move together when the Correlation Coefficient is positive. Conversely, the two assets move in opposite directions when the Correlation Coefficient is negative. Determining your positions' relationship to each other is valuable for analyzing and projecting your portfolio's future expected return and risk.

High positive correlations

FERG	+ 0.94	FAST
GWW	+ 0.93	FAST
POOL	+ 0.88	SITE
POOL	+ 0.88	GWW
POOL	+ 0.86	FAST
GWW	+ 0.86	FERG

High negative correlations

DXPE	- 0.69	FAST
DXPE	- 0.68	GWW
DXPE	- 0.63	FERG
CNM	- 0.6	FAST
DXPE	- 0.54	POOL
CNM	- 0.54	GWW

Risk-Adjusted Indicators

There is a big difference between Watsco Stock performing well and Watsco Company doing well as a business compared to the competition. There are so many exceptions to the norm that investors cannot definitively determine what's good or bad unless they analyze Watsco's multiple risk-adjusted performance indicators across the competitive landscape. These indicators are quantitative in nature and help investors forecast volatility and risk-adjusted expected returns across various positions.

	Mean Deviation	Jensen Alpha	Sortino Ratio	Treynor Ratio	Semi Deviation	Expected Shortfall	Potential Upside	Value @Risk	Maximum Drawdown
FAST	0.82	(0.16)	0.00	(0.26)	0.00	0.00	1.51	(1.79)	5.08
SITE	1.61	(0.05)	0.00	(0.05)	0.00	0.00	3.78	(3.24)	9.51
FERG	1.39	(0.16)	0.00	(0.20)	0.00	0.00	2.71	(2.80)	13.86
GWW	0.85	(0.24)	0.00	(0.31)	0.00	0.00	1.35	(1.95)	7.86
POOL	1.25	(0.11)	0.00	(0.15)	0.00	0.00	2.38	(2.74)	10.56
MSM	1.22	(0.10)	0.00	(0.12)	0.00	0.00	3.33	(2.32)	7.60
AIT	1.08	(0.02)	0.00	(0.02)	0.00	0.00	2.60	(2.21)	6.79
CNM	1.46	0.35	0.27	0.32	1.01	(1.78)	3.55	(1.95)	18.90
DXPE	1.69	0.57	0.27	1.48	1.55	(1.99)	4.38	(3.52)	12.42

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