Correlation Between WIMFARM SA and AECOM TECHNOLOGY
Can any of the company-specific risk be diversified away by investing in both WIMFARM SA and AECOM 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 WIMFARM SA and AECOM TECHNOLOGY into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WIMFARM SA EO and AECOM TECHNOLOGY, you can compare the effects of market volatilities on WIMFARM SA and AECOM 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 WIMFARM SA with a short position of AECOM TECHNOLOGY. Check out your portfolio center. Please also check ongoing floating volatility patterns of WIMFARM SA and AECOM TECHNOLOGY.
Diversification Opportunities for WIMFARM SA and AECOM TECHNOLOGY
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between WIMFARM and AECOM is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding WIMFARM SA EO and AECOM TECHNOLOGY in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AECOM TECHNOLOGY and WIMFARM SA 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 WIMFARM SA EO are associated (or correlated) with AECOM TECHNOLOGY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AECOM TECHNOLOGY has no effect on the direction of WIMFARM SA i.e., WIMFARM SA and AECOM TECHNOLOGY go up and down completely randomly.
Pair Corralation between WIMFARM SA and AECOM TECHNOLOGY
Assuming the 90 days horizon WIMFARM SA EO is expected to generate 4.78 times more return on investment than AECOM TECHNOLOGY. However, WIMFARM SA is 4.78 times more volatile than AECOM TECHNOLOGY. It trades about 0.1 of its potential returns per unit of risk. AECOM TECHNOLOGY is currently generating about -0.15 per unit of risk. If you would invest 326.00 in WIMFARM SA EO on October 30, 2024 and sell it today you would earn a total of 50.00 from holding WIMFARM SA EO or generate 15.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
WIMFARM SA EO vs. AECOM TECHNOLOGY
Performance |
| Timeline |
| WIMFARM SA EO |
| AECOM TECHNOLOGY |
WIMFARM SA and AECOM TECHNOLOGY Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WIMFARM SA and AECOM TECHNOLOGY
The main advantage of trading using opposite WIMFARM SA and AECOM TECHNOLOGY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WIMFARM SA position performs unexpectedly, AECOM 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 AECOM TECHNOLOGY will offset losses from the drop in AECOM TECHNOLOGY's long position.| WIMFARM SA vs. Gladstone Investment | WIMFARM SA vs. MEDCAW INVESTMENTS LS 01 | WIMFARM SA vs. Hisense Home Appliances | WIMFARM SA vs. HK Electric Investments |
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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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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