Correlation Between Gaztransport Technigaz and Wizz Air
Can any of the company-specific risk be diversified away by investing in both Gaztransport Technigaz and Wizz Air 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 Gaztransport Technigaz and Wizz Air into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gaztransport Technigaz SA and Wizz Air Holdings, you can compare the effects of market volatilities on Gaztransport Technigaz and Wizz Air 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 Gaztransport Technigaz with a short position of Wizz Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gaztransport Technigaz and Wizz Air.
Diversification Opportunities for Gaztransport Technigaz and Wizz Air
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Gaztransport and Wizz is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Gaztransport Technigaz SA and Wizz Air Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wizz Air Holdings and Gaztransport Technigaz 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 Gaztransport Technigaz SA are associated (or correlated) with Wizz Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wizz Air Holdings has no effect on the direction of Gaztransport Technigaz i.e., Gaztransport Technigaz and Wizz Air go up and down completely randomly.
Pair Corralation between Gaztransport Technigaz and Wizz Air
Assuming the 90 days horizon Gaztransport Technigaz SA is expected to generate 0.54 times more return on investment than Wizz Air. However, Gaztransport Technigaz SA is 1.87 times less risky than Wizz Air. It trades about 0.07 of its potential returns per unit of risk. Wizz Air Holdings is currently generating about -0.04 per unit of risk. If you would invest 9,031 in Gaztransport Technigaz SA on August 24, 2024 and sell it today you would earn a total of 5,149 from holding Gaztransport Technigaz SA or generate 57.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gaztransport Technigaz SA vs. Wizz Air Holdings
Performance |
| Timeline |
| Gaztransport Technigaz |
| Wizz Air Holdings |
Gaztransport Technigaz and Wizz Air Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gaztransport Technigaz and Wizz Air
The main advantage of trading using opposite Gaztransport Technigaz and Wizz Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gaztransport Technigaz position performs unexpectedly, Wizz Air 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 Wizz Air will offset losses from the drop in Wizz Air's long position.| Gaztransport Technigaz vs. TITANIUM TRANSPORTGROUP | Gaztransport Technigaz vs. Haier Smart Home | Gaztransport Technigaz vs. Aedas Homes SA | Gaztransport Technigaz vs. Gold Road Resources |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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