Correlation Between WillScot Mobile and Hitachi Construction
Can any of the company-specific risk be diversified away by investing in both WillScot Mobile and Hitachi Construction 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 WillScot Mobile and Hitachi Construction into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WillScot Mobile Mini and Hitachi Construction Machinery, you can compare the effects of market volatilities on WillScot Mobile and Hitachi Construction 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 WillScot Mobile with a short position of Hitachi Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of WillScot Mobile and Hitachi Construction.
Diversification Opportunities for WillScot Mobile and Hitachi Construction
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between WillScot and Hitachi is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding WillScot Mobile Mini and Hitachi Construction Machinery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hitachi Construction and WillScot Mobile 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 WillScot Mobile Mini are associated (or correlated) with Hitachi Construction. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hitachi Construction has no effect on the direction of WillScot Mobile i.e., WillScot Mobile and Hitachi Construction go up and down completely randomly.
Pair Corralation between WillScot Mobile and Hitachi Construction
Assuming the 90 days trading horizon WillScot Mobile Mini is expected to generate 1.26 times more return on investment than Hitachi Construction. However, WillScot Mobile is 1.26 times more volatile than Hitachi Construction Machinery. It trades about 0.49 of its potential returns per unit of risk. Hitachi Construction Machinery is currently generating about 0.23 per unit of risk. If you would invest 3,200 in WillScot Mobile Mini on October 24, 2024 and sell it today you would earn a total of 540.00 from holding WillScot Mobile Mini or generate 16.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
WillScot Mobile Mini vs. Hitachi Construction Machinery
Performance |
| Timeline |
| WillScot Mobile Mini |
| Hitachi Construction |
WillScot Mobile and Hitachi Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WillScot Mobile and Hitachi Construction
The main advantage of trading using opposite WillScot Mobile and Hitachi Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WillScot Mobile position performs unexpectedly, Hitachi Construction 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 Hitachi Construction will offset losses from the drop in Hitachi Construction's long position.| WillScot Mobile vs. Treasury Wine Estates | WillScot Mobile vs. Summit Materials | WillScot Mobile vs. THRACE PLASTICS | WillScot Mobile vs. GEELY AUTOMOBILE |
| Hitachi Construction vs. WillScot Mobile Mini | Hitachi Construction vs. T MOBILE US | Hitachi Construction vs. Coffee Holding Co | Hitachi Construction vs. GRIFFIN MINING LTD |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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