Correlation Between Willdan and Rollins
Can any of the company-specific risk be diversified away by investing in both Willdan and Rollins 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 Willdan and Rollins into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Willdan Group and Rollins, you can compare the effects of market volatilities on Willdan and Rollins 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 Willdan with a short position of Rollins. Check out your portfolio center. Please also check ongoing floating volatility patterns of Willdan and Rollins.
Diversification Opportunities for Willdan and Rollins
Excellent diversification
The 3 months correlation between Willdan and Rollins is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Willdan Group and Rollins in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rollins and Willdan 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 Willdan Group are associated (or correlated) with Rollins. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rollins has no effect on the direction of Willdan i.e., Willdan and Rollins go up and down completely randomly.
Pair Corralation between Willdan and Rollins
Given the investment horizon of 90 days Willdan Group is expected to under-perform the Rollins. In addition to that, Willdan is 1.53 times more volatile than Rollins. It trades about -0.09 of its total potential returns per unit of risk. Rollins is currently generating about 0.01 per unit of volatility. If you would invest 4,959 in Rollins on August 24, 2024 and sell it today you would earn a total of 4.00 from holding Rollins or generate 0.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Willdan Group vs. Rollins
Performance |
| Timeline |
| Willdan Group |
| Rollins |
Willdan and Rollins Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Willdan and Rollins
The main advantage of trading using opposite Willdan and Rollins positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Willdan position performs unexpectedly, Rollins 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 Rollins will offset losses from the drop in Rollins' long position.| Willdan vs. SNC Lavalin Group | Willdan vs. WSP Global | Willdan vs. Comfort Systems USA | Willdan vs. MYR Group |
| Rollins vs. Carriage Services | Rollins vs. Frontdoor | Rollins vs. Mister Car Wash | Rollins vs. Bright Horizons Family |
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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