Correlation Between Wizz Air and One Media
Can any of the company-specific risk be diversified away by investing in both Wizz Air and One Media 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 One Media 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 One Media iP, you can compare the effects of market volatilities on Wizz Air and One Media 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 One Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wizz Air and One Media.
Diversification Opportunities for Wizz Air and One Media
Very good diversification
The 3 months correlation between Wizz and One is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Wizz Air Holdings and One Media iP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on One Media iP 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 One Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of One Media iP has no effect on the direction of Wizz Air i.e., Wizz Air and One Media go up and down completely randomly.
Pair Corralation between Wizz Air and One Media
Assuming the 90 days trading horizon Wizz Air Holdings is expected to generate 1.49 times more return on investment than One Media. However, Wizz Air is 1.49 times more volatile than One Media iP. It trades about 0.03 of its potential returns per unit of risk. One Media iP is currently generating about 0.01 per unit of risk. If you would invest 125,100 in Wizz Air Holdings on September 3, 2024 and sell it today you would earn a total of 3,600 from holding Wizz Air Holdings or generate 2.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wizz Air Holdings vs. One Media iP
Performance |
| Timeline |
| Wizz Air Holdings |
| One Media iP |
Wizz Air and One Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wizz Air and One Media
The main advantage of trading using opposite Wizz Air and One Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wizz Air position performs unexpectedly, One Media 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 One Media will offset losses from the drop in One Media's long position.| Wizz Air vs. Cornish Metals | Wizz Air vs. Hansa Investment | Wizz Air vs. Gear4music Plc | Wizz Air vs. Panther Metals PLC |
| One Media vs. Intuitive Investments Group | One Media vs. European Metals Holdings | One Media vs. Athelney Trust plc | One Media vs. Invesco Health Care |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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