Correlation Between WSP Global and George Weston
Can any of the company-specific risk be diversified away by investing in both WSP Global and George Weston 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 George Weston into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WSP Global and George Weston Limited, you can compare the effects of market volatilities on WSP Global and George Weston 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 George Weston. Check out your portfolio center. Please also check ongoing floating volatility patterns of WSP Global and George Weston.
Diversification Opportunities for WSP Global and George Weston
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between WSP and George is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding WSP Global and George Weston Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on George Weston Limited 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 George Weston. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of George Weston Limited has no effect on the direction of WSP Global i.e., WSP Global and George Weston go up and down completely randomly.
Pair Corralation between WSP Global and George Weston
Assuming the 90 days horizon WSP Global is expected to generate 1.31 times less return on investment than George Weston. In addition to that, WSP Global is 1.21 times more volatile than George Weston Limited. It trades about 0.1 of its total potential returns per unit of risk. George Weston Limited is currently generating about 0.15 per unit of volatility. If you would invest 11,650 in George Weston Limited on August 26, 2024 and sell it today you would earn a total of 4,160 from holding George Weston Limited or generate 35.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 85.45% |
| Values | Daily Returns |
WSP Global vs. George Weston Limited
Performance |
| Timeline |
| WSP Global |
| George Weston Limited |
WSP Global and George Weston Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WSP Global and George Weston
The main advantage of trading using opposite WSP Global and George Weston positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WSP Global position performs unexpectedly, George Weston 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 George Weston will offset losses from the drop in George Weston's long position.| WSP Global vs. George Weston Limited | WSP Global vs. Intact Financial | WSP Global vs. Metro Inc | WSP Global vs. Kingspan Group PLC |
| George Weston vs. Embotelladora Andina SA | George Weston vs. Signet International Holdings | George Weston vs. National Beverage Corp | George Weston vs. PT Astra International |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
Other Complementary Tools
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years |