Correlation Between WH Group and Wirecard
Can any of the company-specific risk be diversified away by investing in both WH Group and Wirecard 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 WH Group and Wirecard into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WH Group Limited and Wirecard AG, you can compare the effects of market volatilities on WH Group and Wirecard 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 WH Group with a short position of Wirecard. Check out your portfolio center. Please also check ongoing floating volatility patterns of WH Group and Wirecard.
Diversification Opportunities for WH Group and Wirecard
Average diversification
The 3 months correlation between WHGRF and Wirecard is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding WH Group Limited and Wirecard AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wirecard AG and WH Group 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 WH Group Limited are associated (or correlated) with Wirecard. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wirecard AG has no effect on the direction of WH Group i.e., WH Group and Wirecard go up and down completely randomly.
Pair Corralation between WH Group and Wirecard
Assuming the 90 days horizon WH Group is expected to generate 1.66 times less return on investment than Wirecard. But when comparing it to its historical volatility, WH Group Limited is 2.32 times less risky than Wirecard. It trades about 0.16 of its potential returns per unit of risk. Wirecard AG is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 0.01 in Wirecard AG on September 26, 2024 and sell it today you would earn a total of 0.99 from holding Wirecard AG or generate 9900.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 64.15% |
| Values | Daily Returns |
WH Group Limited vs. Wirecard AG
Performance |
| Timeline |
| WH Group Limited |
| Wirecard AG |
WH Group and Wirecard Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WH Group and Wirecard
The main advantage of trading using opposite WH Group and Wirecard positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WH Group position performs unexpectedly, Wirecard 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 Wirecard will offset losses from the drop in Wirecard's long position.| WH Group vs. Qed Connect | WH Group vs. Branded Legacy | WH Group vs. Yuenglings Ice Cream | WH Group vs. Bit Origin |
| Wirecard vs. NextPlat Corp | Wirecard vs. Liquid Avatar Technologies | Wirecard vs. Waldencast Acquisition Corp | Wirecard vs. CXApp Inc |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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