Correlation Between Wilhelmina and SOS
Can any of the company-specific risk be diversified away by investing in both Wilhelmina and SOS 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 Wilhelmina and SOS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wilhelmina and SOS Limited, you can compare the effects of market volatilities on Wilhelmina and SOS 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 Wilhelmina with a short position of SOS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wilhelmina and SOS.
Diversification Opportunities for Wilhelmina and SOS
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Wilhelmina and SOS is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Wilhelmina and SOS Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SOS Limited and Wilhelmina 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 Wilhelmina are associated (or correlated) with SOS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SOS Limited has no effect on the direction of Wilhelmina i.e., Wilhelmina and SOS go up and down completely randomly.
Pair Corralation between Wilhelmina and SOS
Given the investment horizon of 90 days Wilhelmina is expected to generate 0.21 times more return on investment than SOS. However, Wilhelmina is 4.67 times less risky than SOS. It trades about 0.33 of its potential returns per unit of risk. SOS Limited is currently generating about -0.03 per unit of risk. If you would invest 332.00 in Wilhelmina on August 29, 2024 and sell it today you would earn a total of 74.00 from holding Wilhelmina or generate 22.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wilhelmina vs. SOS Limited
Performance |
| Timeline |
| Wilhelmina |
| SOS Limited |
Wilhelmina and SOS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wilhelmina and SOS
The main advantage of trading using opposite Wilhelmina and SOS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wilhelmina position performs unexpectedly, SOS 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 SOS will offset losses from the drop in SOS's long position.| Wilhelmina vs. Performant Financial | Wilhelmina vs. Network 1 Technologies | Wilhelmina vs. Rentokil Initial PLC | Wilhelmina vs. Mader Group Limited |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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