Correlation Between Axalta Coating and WesBanco
Can any of the company-specific risk be diversified away by investing in both Axalta Coating and WesBanco 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 Axalta Coating and WesBanco into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Axalta Coating Systems and WesBanco, you can compare the effects of market volatilities on Axalta Coating and WesBanco 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 Axalta Coating with a short position of WesBanco. Check out your portfolio center. Please also check ongoing floating volatility patterns of Axalta Coating and WesBanco.
Diversification Opportunities for Axalta Coating and WesBanco
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Axalta and WesBanco is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Axalta Coating Systems and WesBanco in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WesBanco and Axalta Coating 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 Axalta Coating Systems are associated (or correlated) with WesBanco. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WesBanco has no effect on the direction of Axalta Coating i.e., Axalta Coating and WesBanco go up and down completely randomly.
Pair Corralation between Axalta Coating and WesBanco
Given the investment horizon of 90 days Axalta Coating Systems is expected to generate 5.66 times more return on investment than WesBanco. However, Axalta Coating is 5.66 times more volatile than WesBanco. It trades about 0.12 of its potential returns per unit of risk. WesBanco is currently generating about 0.19 per unit of risk. If you would invest 3,452 in Axalta Coating Systems on September 12, 2024 and sell it today you would earn a total of 435.00 from holding Axalta Coating Systems or generate 12.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Axalta Coating Systems vs. WesBanco
Performance |
| Timeline |
| Axalta Coating Systems |
| WesBanco |
Axalta Coating and WesBanco Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Axalta Coating and WesBanco
The main advantage of trading using opposite Axalta Coating and WesBanco positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Axalta Coating position performs unexpectedly, WesBanco 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 WesBanco will offset losses from the drop in WesBanco's long position.| Axalta Coating vs. Avient Corp | Axalta Coating vs. H B Fuller | Axalta Coating vs. Quaker Chemical | Axalta Coating vs. Cabot |
| WesBanco vs. Kontoor Brands | WesBanco vs. Ralph Lauren Corp | WesBanco vs. Nike Inc | WesBanco vs. Vita Coco |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
Other Complementary Tools
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance |