Correlation Between WSP Global and Current Water
Can any of the company-specific risk be diversified away by investing in both WSP Global and Current Water 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 WSP Global and Current Water into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WSP Global and Current Water Technologies, you can compare the effects of market volatilities on WSP Global and Current Water 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 WSP Global with a short position of Current Water. Check out your portfolio center. Please also check ongoing floating volatility patterns of WSP Global and Current Water.
Diversification Opportunities for WSP Global and Current Water
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between WSP and Current is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding WSP Global and Current Water Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Current Water Techno and WSP Global 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 WSP Global are associated (or correlated) with Current Water. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Current Water Techno has no effect on the direction of WSP Global i.e., WSP Global and Current Water go up and down completely randomly.
Pair Corralation between WSP Global and Current Water
Assuming the 90 days trading horizon WSP Global is expected to generate 12.74 times less return on investment than Current Water. But when comparing it to its historical volatility, WSP Global is 22.87 times less risky than Current Water. It trades about 0.22 of its potential returns per unit of risk. Current Water Technologies is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 3.00 in Current Water Technologies on September 13, 2024 and sell it today you would earn a total of 0.50 from holding Current Water Technologies or generate 16.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
WSP Global vs. Current Water Technologies
Performance |
| Timeline |
| WSP Global |
| Current Water Techno |
WSP Global and Current Water Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WSP Global and Current Water
The main advantage of trading using opposite WSP Global and Current Water positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WSP Global position performs unexpectedly, Current Water 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 Current Water will offset losses from the drop in Current Water's long position.| WSP Global vs. TFI International | WSP Global vs. Stantec | WSP Global vs. Waste Connections | WSP Global vs. CGI Inc |
| Current Water vs. Firan Technology Group | Current Water vs. iShares Canadian HYBrid | Current Water vs. Altagas Cum Red | Current Water vs. European Residential Real |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
Other Complementary Tools
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories |