Correlation Between Wilh Wilhelmsen and Vow ASA
Can any of the company-specific risk be diversified away by investing in both Wilh Wilhelmsen and Vow ASA 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 Vow ASA 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 Vow ASA, you can compare the effects of market volatilities on Wilh Wilhelmsen and Vow ASA 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 Vow ASA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wilh Wilhelmsen and Vow ASA.
Diversification Opportunities for Wilh Wilhelmsen and Vow ASA
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Wilh and Vow is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Wilh Wilhelmsen Holding and Vow ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vow ASA 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 Vow ASA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vow ASA has no effect on the direction of Wilh Wilhelmsen i.e., Wilh Wilhelmsen and Vow ASA go up and down completely randomly.
Pair Corralation between Wilh Wilhelmsen and Vow ASA
Assuming the 90 days trading horizon Wilh Wilhelmsen Holding is expected to generate 0.25 times more return on investment than Vow ASA. However, Wilh Wilhelmsen Holding is 3.95 times less risky than Vow ASA. It trades about -0.05 of its potential returns per unit of risk. Vow ASA is currently generating about -0.2 per unit of risk. If you would invest 43,697 in Wilh Wilhelmsen Holding on August 27, 2024 and sell it today you would lose (1,147) from holding Wilh Wilhelmsen Holding or give up 2.62% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wilh Wilhelmsen Holding vs. Vow ASA
Performance |
| Timeline |
| Wilh Wilhelmsen Holding |
| Vow ASA |
Wilh Wilhelmsen and Vow ASA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wilh Wilhelmsen and Vow ASA
The main advantage of trading using opposite Wilh Wilhelmsen and Vow ASA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wilh Wilhelmsen position performs unexpectedly, Vow ASA 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 Vow ASA will offset losses from the drop in Vow ASA's long position.| Wilh Wilhelmsen vs. Eidesvik Offshore ASA | Wilh Wilhelmsen vs. Kitron ASA | Wilh Wilhelmsen vs. Havila Shipping ASA | Wilh Wilhelmsen vs. Elkem ASA |
| Vow ASA vs. Arctic Bioscience AS | Vow ASA vs. ADS Maritime Holding | Vow ASA vs. Arctic Fish Holding | Vow ASA vs. Instabank ASA |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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