Correlation Between WillScot Mobile and Westinghouse Air
Can any of the company-specific risk be diversified away by investing in both WillScot Mobile and Westinghouse Air 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 Westinghouse Air 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 Westinghouse Air Brake, you can compare the effects of market volatilities on WillScot Mobile and Westinghouse Air 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 Westinghouse Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of WillScot Mobile and Westinghouse Air.
Diversification Opportunities for WillScot Mobile and Westinghouse Air
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between WillScot and Westinghouse is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding WillScot Mobile Mini and Westinghouse Air Brake in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Westinghouse Air Brake 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 Westinghouse Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Westinghouse Air Brake has no effect on the direction of WillScot Mobile i.e., WillScot Mobile and Westinghouse Air go up and down completely randomly.
Pair Corralation between WillScot Mobile and Westinghouse Air
Assuming the 90 days trading horizon WillScot Mobile Mini is expected to generate 2.1 times more return on investment than Westinghouse Air. However, WillScot Mobile is 2.1 times more volatile than Westinghouse Air Brake. It trades about 0.48 of its potential returns per unit of risk. Westinghouse Air Brake is currently generating about 0.58 per unit of risk. If you would invest 3,180 in WillScot Mobile Mini on October 29, 2024 and sell it today you would earn a total of 520.00 from holding WillScot Mobile Mini or generate 16.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
WillScot Mobile Mini vs. Westinghouse Air Brake
Performance |
| Timeline |
| WillScot Mobile Mini |
| Westinghouse Air Brake |
WillScot Mobile and Westinghouse Air Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WillScot Mobile and Westinghouse Air
The main advantage of trading using opposite WillScot Mobile and Westinghouse Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WillScot Mobile position performs unexpectedly, Westinghouse Air 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 Westinghouse Air will offset losses from the drop in Westinghouse Air's long position.| WillScot Mobile vs. InterContinental Hotels Group | WillScot Mobile vs. SEKISUI CHEMICAL | WillScot Mobile vs. Park Hotels Resorts | WillScot Mobile vs. KINGBOARD CHEMICAL |
| Westinghouse Air vs. Ribbon Communications | Westinghouse Air vs. CITIC Telecom International | Westinghouse Air vs. Cairo Communication SpA | Westinghouse Air vs. Spirent Communications plc |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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