Correlation Between ZIM Integrated and Wilh Wilhelmsen
Can any of the company-specific risk be diversified away by investing in both ZIM Integrated and Wilh Wilhelmsen 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 ZIM Integrated and Wilh Wilhelmsen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ZIM Integrated Shipping and Wilh Wilhelmsen Holding, you can compare the effects of market volatilities on ZIM Integrated and Wilh Wilhelmsen 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 ZIM Integrated with a short position of Wilh Wilhelmsen. Check out your portfolio center. Please also check ongoing floating volatility patterns of ZIM Integrated and Wilh Wilhelmsen.
Diversification Opportunities for ZIM Integrated and Wilh Wilhelmsen
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between ZIM and Wilh is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding ZIM Integrated Shipping and Wilh Wilhelmsen Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wilh Wilhelmsen Holding and ZIM Integrated 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 ZIM Integrated Shipping are associated (or correlated) with Wilh Wilhelmsen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wilh Wilhelmsen Holding has no effect on the direction of ZIM Integrated i.e., ZIM Integrated and Wilh Wilhelmsen go up and down completely randomly.
Pair Corralation between ZIM Integrated and Wilh Wilhelmsen
Assuming the 90 days horizon ZIM Integrated Shipping is expected to generate 1.4 times more return on investment than Wilh Wilhelmsen. However, ZIM Integrated is 1.4 times more volatile than Wilh Wilhelmsen Holding. It trades about 0.1 of its potential returns per unit of risk. Wilh Wilhelmsen Holding is currently generating about 0.1 per unit of risk. If you would invest 843.00 in ZIM Integrated Shipping on August 25, 2024 and sell it today you would earn a total of 1,475 from holding ZIM Integrated Shipping or generate 174.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ZIM Integrated Shipping vs. Wilh Wilhelmsen Holding
Performance |
| Timeline |
| ZIM Integrated Shipping |
| Wilh Wilhelmsen Holding |
ZIM Integrated and Wilh Wilhelmsen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ZIM Integrated and Wilh Wilhelmsen
The main advantage of trading using opposite ZIM Integrated and Wilh Wilhelmsen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ZIM Integrated position performs unexpectedly, Wilh Wilhelmsen 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 Wilh Wilhelmsen will offset losses from the drop in Wilh Wilhelmsen's long position.| ZIM Integrated vs. Superior Plus Corp | ZIM Integrated vs. NMI Holdings | ZIM Integrated vs. Origin Agritech | ZIM Integrated vs. SIVERS SEMICONDUCTORS AB |
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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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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