Correlation Between Wilmington Capital and Great West
Can any of the company-specific risk be diversified away by investing in both Wilmington Capital and Great West 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 Wilmington Capital and Great West into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wilmington Capital Management and Great West Lifeco, you can compare the effects of market volatilities on Wilmington Capital and Great West 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 Wilmington Capital with a short position of Great West. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wilmington Capital and Great West.
Diversification Opportunities for Wilmington Capital and Great West
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Wilmington and Great is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Wilmington Capital Management and Great West Lifeco in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Great West Lifeco and Wilmington 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 Wilmington Capital Management are associated (or correlated) with Great West. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Great West Lifeco has no effect on the direction of Wilmington Capital i.e., Wilmington Capital and Great West go up and down completely randomly.
Pair Corralation between Wilmington Capital and Great West
Assuming the 90 days trading horizon Wilmington Capital Management is expected to generate 5.51 times more return on investment than Great West. However, Wilmington Capital is 5.51 times more volatile than Great West Lifeco. It trades about 0.21 of its potential returns per unit of risk. Great West Lifeco is currently generating about -0.24 per unit of risk. If you would invest 250.00 in Wilmington Capital Management on August 28, 2024 and sell it today you would earn a total of 31.00 from holding Wilmington Capital Management or generate 12.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wilmington Capital Management vs. Great West Lifeco
Performance |
| Timeline |
| Wilmington Capital |
| Great West Lifeco |
Wilmington Capital and Great West Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wilmington Capital and Great West
The main advantage of trading using opposite Wilmington Capital and Great West positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wilmington Capital position performs unexpectedly, Great West 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 Great West will offset losses from the drop in Great West's long position.| Wilmington Capital vs. Nova Leap Health | Wilmington Capital vs. Maple Leaf Foods | Wilmington Capital vs. Capstone Mining Corp | Wilmington Capital vs. High Liner Foods |
| Great West vs. Perseus Mining | Great West vs. Jamieson Wellness | Great West vs. T2 Metals Corp | Great West vs. Ramp Metals |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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