Correlation Between Intermediate Capital and Wizz Air
Can any of the company-specific risk be diversified away by investing in both Intermediate Capital 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 Intermediate Capital and Wizz Air into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Intermediate Capital Group and Wizz Air Holdings, you can compare the effects of market volatilities on Intermediate Capital 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 Intermediate Capital with a short position of Wizz Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intermediate Capital and Wizz Air.
Diversification Opportunities for Intermediate Capital and Wizz Air
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Intermediate and Wizz is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Intermediate Capital Group 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 Intermediate Capital 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 Intermediate Capital Group 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 Intermediate Capital i.e., Intermediate Capital and Wizz Air go up and down completely randomly.
Pair Corralation between Intermediate Capital and Wizz Air
Assuming the 90 days trading horizon Intermediate Capital Group is expected to generate 0.57 times more return on investment than Wizz Air. However, Intermediate Capital Group is 1.76 times less risky than Wizz Air. It trades about 0.08 of its potential returns per unit of risk. Wizz Air Holdings is currently generating about -0.01 per unit of risk. If you would invest 119,836 in Intermediate Capital Group on November 29, 2024 and sell it today you would earn a total of 108,964 from holding Intermediate Capital Group or generate 90.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Intermediate Capital Group vs. Wizz Air Holdings
Performance |
| Timeline |
| Intermediate Capital |
| Wizz Air Holdings |
Intermediate Capital and Wizz Air Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Intermediate Capital and Wizz Air
The main advantage of trading using opposite Intermediate Capital and Wizz Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intermediate Capital 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.| Intermediate Capital vs. Datalogic | Intermediate Capital vs. Fortuna Silver Mines | Intermediate Capital vs. Datagroup SE | Intermediate Capital vs. Beowulf Mining |
| Wizz Air vs. BW Offshore | Wizz Air vs. Alaska Air Group | Wizz Air vs. Clean Power Hydrogen | Wizz Air vs. CleanTech Lithium plc |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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