Correlation Between Cardinal Small and Wilmington Trust
Can any of the company-specific risk be diversified away by investing in both Cardinal Small and Wilmington Trust 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 Cardinal Small and Wilmington Trust into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cardinal Small Cap and Wilmington Trust Retirement, you can compare the effects of market volatilities on Cardinal Small and Wilmington Trust 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 Cardinal Small with a short position of Wilmington Trust. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cardinal Small and Wilmington Trust.
Diversification Opportunities for Cardinal Small and Wilmington Trust
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Cardinal and Wilmington is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Cardinal Small Cap and Wilmington Trust Retirement in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wilmington Trust Ret and Cardinal Small 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 Cardinal Small Cap are associated (or correlated) with Wilmington Trust. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wilmington Trust Ret has no effect on the direction of Cardinal Small i.e., Cardinal Small and Wilmington Trust go up and down completely randomly.
Pair Corralation between Cardinal Small and Wilmington Trust
Assuming the 90 days horizon Cardinal Small is expected to generate 1.57 times less return on investment than Wilmington Trust. But when comparing it to its historical volatility, Cardinal Small Cap is 1.18 times less risky than Wilmington Trust. It trades about 0.06 of its potential returns per unit of risk. Wilmington Trust Retirement is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 28,282 in Wilmington Trust Retirement on November 3, 2024 and sell it today you would earn a total of 5,361 from holding Wilmington Trust Retirement or generate 18.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.6% |
| Values | Daily Returns |
Cardinal Small Cap vs. Wilmington Trust Retirement
Performance |
| Timeline |
| Cardinal Small Cap |
| Wilmington Trust Ret |
Cardinal Small and Wilmington Trust Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cardinal Small and Wilmington Trust
The main advantage of trading using opposite Cardinal Small and Wilmington Trust positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cardinal Small position performs unexpectedly, Wilmington Trust 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 Wilmington Trust will offset losses from the drop in Wilmington Trust's long position.| Cardinal Small vs. Wmcanx | Cardinal Small vs. Fuhkbx | Cardinal Small vs. Fbjygx | Cardinal Small vs. Fvkvwx |
| Wilmington Trust vs. Allianzgi Convertible Income | Wilmington Trust vs. Virtus Convertible | Wilmington Trust vs. Absolute Convertible Arbitrage | Wilmington Trust vs. Advent Claymore Convertible |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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