Correlation Between Retail Estates and WillScot Mobile
Can any of the company-specific risk be diversified away by investing in both Retail Estates and WillScot Mobile 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 Retail Estates and WillScot Mobile into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Retail Estates NV and WillScot Mobile Mini, you can compare the effects of market volatilities on Retail Estates and WillScot Mobile 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 Retail Estates with a short position of WillScot Mobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of Retail Estates and WillScot Mobile.
Diversification Opportunities for Retail Estates and WillScot Mobile
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Retail and WillScot is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Retail Estates NV and WillScot Mobile Mini in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WillScot Mobile Mini and Retail Estates 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 Retail Estates NV are associated (or correlated) with WillScot Mobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WillScot Mobile Mini has no effect on the direction of Retail Estates i.e., Retail Estates and WillScot Mobile go up and down completely randomly.
Pair Corralation between Retail Estates and WillScot Mobile
Assuming the 90 days horizon Retail Estates NV is expected to under-perform the WillScot Mobile. But the stock apears to be less risky and, when comparing its historical volatility, Retail Estates NV is 2.91 times less risky than WillScot Mobile. The stock trades about -0.11 of its potential returns per unit of risk. The WillScot Mobile Mini is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 3,420 in WillScot Mobile Mini on August 29, 2024 and sell it today you would earn a total of 20.00 from holding WillScot Mobile Mini or generate 0.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Retail Estates NV vs. WillScot Mobile Mini
Performance |
| Timeline |
| Retail Estates NV |
| WillScot Mobile Mini |
Retail Estates and WillScot Mobile Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Retail Estates and WillScot Mobile
The main advantage of trading using opposite Retail Estates and WillScot Mobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Retail Estates position performs unexpectedly, WillScot Mobile 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 WillScot Mobile will offset losses from the drop in WillScot Mobile's long position.| Retail Estates vs. DEVRY EDUCATION GRP | Retail Estates vs. MAGIC SOFTWARE ENTR | Retail Estates vs. EMBARK EDUCATION LTD | Retail Estates vs. GALENA MINING LTD |
| WillScot Mobile vs. United Rentals | WillScot Mobile vs. Superior Plus Corp | WillScot Mobile vs. SIVERS SEMICONDUCTORS AB | WillScot Mobile vs. Talanx AG |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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