Correlation Between Wilh Wilhelmsen and Commercial Vehicle
Can any of the company-specific risk be diversified away by investing in both Wilh Wilhelmsen and Commercial Vehicle 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 Wilh Wilhelmsen and Commercial Vehicle into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wilh Wilhelmsen Holding and Commercial Vehicle Group, you can compare the effects of market volatilities on Wilh Wilhelmsen and Commercial Vehicle 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 Wilh Wilhelmsen with a short position of Commercial Vehicle. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wilh Wilhelmsen and Commercial Vehicle.
Diversification Opportunities for Wilh Wilhelmsen and Commercial Vehicle
-0.83 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Wilh and Commercial is -0.83. Overlapping area represents the amount of risk that can be diversified away by holding Wilh Wilhelmsen Holding and Commercial Vehicle Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Commercial Vehicle and Wilh Wilhelmsen 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 Wilh Wilhelmsen Holding are associated (or correlated) with Commercial Vehicle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Commercial Vehicle has no effect on the direction of Wilh Wilhelmsen i.e., Wilh Wilhelmsen and Commercial Vehicle go up and down completely randomly.
Pair Corralation between Wilh Wilhelmsen and Commercial Vehicle
Assuming the 90 days trading horizon Wilh Wilhelmsen Holding is expected to generate 1.19 times more return on investment than Commercial Vehicle. However, Wilh Wilhelmsen is 1.19 times more volatile than Commercial Vehicle Group. It trades about 0.11 of its potential returns per unit of risk. Commercial Vehicle Group is currently generating about -0.11 per unit of risk. If you would invest 937.00 in Wilh Wilhelmsen Holding on September 2, 2024 and sell it today you would earn a total of 2,333 from holding Wilh Wilhelmsen Holding or generate 248.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wilh Wilhelmsen Holding vs. Commercial Vehicle Group
Performance |
| Timeline |
| Wilh Wilhelmsen Holding |
| Commercial Vehicle |
Wilh Wilhelmsen and Commercial Vehicle Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wilh Wilhelmsen and Commercial Vehicle
The main advantage of trading using opposite Wilh Wilhelmsen and Commercial Vehicle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wilh Wilhelmsen position performs unexpectedly, Commercial Vehicle 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 Commercial Vehicle will offset losses from the drop in Commercial Vehicle's long position.| Wilh Wilhelmsen vs. Zurich Insurance Group | Wilh Wilhelmsen vs. United Insurance Holdings | Wilh Wilhelmsen vs. Mitsui Chemicals | Wilh Wilhelmsen vs. Perdoceo Education |
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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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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