Correlation Between CAP LEASE and Wheaton Precious
Can any of the company-specific risk be diversified away by investing in both CAP LEASE and Wheaton Precious 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 CAP LEASE and Wheaton Precious into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CAP LEASE AVIATION and Wheaton Precious Metals, you can compare the effects of market volatilities on CAP LEASE and Wheaton Precious 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 CAP LEASE with a short position of Wheaton Precious. Check out your portfolio center. Please also check ongoing floating volatility patterns of CAP LEASE and Wheaton Precious.
Diversification Opportunities for CAP LEASE and Wheaton Precious
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between CAP and Wheaton is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding CAP LEASE AVIATION and Wheaton Precious Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wheaton Precious Metals and CAP LEASE 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 CAP LEASE AVIATION are associated (or correlated) with Wheaton Precious. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wheaton Precious Metals has no effect on the direction of CAP LEASE i.e., CAP LEASE and Wheaton Precious go up and down completely randomly.
Pair Corralation between CAP LEASE and Wheaton Precious
Assuming the 90 days trading horizon CAP LEASE AVIATION is expected to under-perform the Wheaton Precious. In addition to that, CAP LEASE is 1.29 times more volatile than Wheaton Precious Metals. It trades about -0.17 of its total potential returns per unit of risk. Wheaton Precious Metals is currently generating about -0.13 per unit of volatility. If you would invest 514,353 in Wheaton Precious Metals on August 30, 2024 and sell it today you would lose (28,853) from holding Wheaton Precious Metals or give up 5.61% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CAP LEASE AVIATION vs. Wheaton Precious Metals
Performance |
| Timeline |
| CAP LEASE AVIATION |
| Wheaton Precious Metals |
CAP LEASE and Wheaton Precious Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CAP LEASE and Wheaton Precious
The main advantage of trading using opposite CAP LEASE and Wheaton Precious positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CAP LEASE position performs unexpectedly, Wheaton Precious 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 Wheaton Precious will offset losses from the drop in Wheaton Precious' long position.| CAP LEASE vs. Givaudan SA | CAP LEASE vs. Antofagasta PLC | CAP LEASE vs. Centamin PLC | CAP LEASE vs. Atalaya Mining |
| Wheaton Precious vs. Givaudan SA | Wheaton Precious vs. Antofagasta PLC | Wheaton Precious vs. Centamin PLC | Wheaton Precious vs. Atalaya Mining |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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