Correlation Between Wilmar International and Sipef NV
Can any of the company-specific risk be diversified away by investing in both Wilmar International and Sipef NV 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 Wilmar International and Sipef NV into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wilmar International Limited and Sipef NV, you can compare the effects of market volatilities on Wilmar International and Sipef NV 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 Wilmar International with a short position of Sipef NV. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wilmar International and Sipef NV.
Diversification Opportunities for Wilmar International and Sipef NV
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Wilmar and Sipef is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Wilmar International Limited and Sipef NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sipef NV and Wilmar International 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 Wilmar International Limited are associated (or correlated) with Sipef NV. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sipef NV has no effect on the direction of Wilmar International i.e., Wilmar International and Sipef NV go up and down completely randomly.
Pair Corralation between Wilmar International and Sipef NV
If you would invest 254.00 in Wilmar International Limited on September 4, 2024 and sell it today you would lose (23.00) from holding Wilmar International Limited or give up 9.06% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 0.54% |
| Values | Daily Returns |
Wilmar International Limited vs. Sipef NV
Performance |
| Timeline |
| Wilmar International |
| Sipef NV |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Wilmar International and Sipef NV Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wilmar International and Sipef NV
The main advantage of trading using opposite Wilmar International and Sipef NV positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wilmar International position performs unexpectedly, Sipef NV 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 Sipef NV will offset losses from the drop in Sipef NV's long position.| Wilmar International vs. Fresh Del Monte | Wilmar International vs. Limoneira Co | Wilmar International vs. Brasilagro Adr | Wilmar International vs. Alico Inc |
| Sipef NV vs. Afya | Sipef NV vs. Asure Software | Sipef NV vs. Cumulus Media Class | Sipef NV vs. United Airlines Holdings |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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