Correlation Between Wizz Air and Hilton Food
Can any of the company-specific risk be diversified away by investing in both Wizz Air and Hilton Food 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 Wizz Air and Hilton Food into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wizz Air Holdings and Hilton Food Group, you can compare the effects of market volatilities on Wizz Air and Hilton Food 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 Wizz Air with a short position of Hilton Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wizz Air and Hilton Food.
Diversification Opportunities for Wizz Air and Hilton Food
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Wizz and Hilton is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Wizz Air Holdings and Hilton Food Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hilton Food Group and Wizz Air 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 Wizz Air Holdings are associated (or correlated) with Hilton Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hilton Food Group has no effect on the direction of Wizz Air i.e., Wizz Air and Hilton Food go up and down completely randomly.
Pair Corralation between Wizz Air and Hilton Food
Assuming the 90 days trading horizon Wizz Air Holdings is expected to under-perform the Hilton Food. In addition to that, Wizz Air is 2.48 times more volatile than Hilton Food Group. It trades about -0.05 of its total potential returns per unit of risk. Hilton Food Group is currently generating about 0.05 per unit of volatility. If you would invest 77,628 in Hilton Food Group on November 3, 2024 and sell it today you would earn a total of 10,772 from holding Hilton Food Group or generate 13.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.6% |
| Values | Daily Returns |
Wizz Air Holdings vs. Hilton Food Group
Performance |
| Timeline |
| Wizz Air Holdings |
| Hilton Food Group |
Wizz Air and Hilton Food Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wizz Air and Hilton Food
The main advantage of trading using opposite Wizz Air and Hilton Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wizz Air position performs unexpectedly, Hilton Food 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 Hilton Food will offset losses from the drop in Hilton Food's long position.| Wizz Air vs. Atresmedia | Wizz Air vs. Aeorema Communications Plc | Wizz Air vs. XLMedia PLC | Wizz Air vs. Prosiebensat 1 Media |
| Hilton Food vs. Check Point Software | Hilton Food vs. Alliance Data Systems | Hilton Food vs. Learning Technologies Group | Hilton Food vs. Rosslyn Data Technologies |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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