Correlation Between CBIZ and Wilhelmina

Can any of the company-specific risk be diversified away by investing in both CBIZ and Wilhelmina 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 CBIZ and Wilhelmina into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between CBIZ Inc and Wilhelmina, you can compare the effects of market volatilities on CBIZ and Wilhelmina 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 CBIZ with a short position of Wilhelmina. Check out your portfolio center. Please also check ongoing floating volatility patterns of CBIZ and Wilhelmina.

Diversification Opportunities for CBIZ and Wilhelmina

-0.27

Correlation Coefficient

CBIZ  Wilhelmina

Very good diversification

The 3 months correlation between CBIZ and Wilhelmina is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding CBIZ Inc and Wilhelmina in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wilhelmina and CBIZ 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 CBIZ Inc are associated (or correlated) with Wilhelmina. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wilhelmina has no effect on the direction of CBIZ i.e., CBIZ and Wilhelmina go up and down completely randomly.

Pair Corralation between CBIZ and Wilhelmina

Considering the 90-day investment horizon CBIZ Inc is expected to generate 0.61 times more return on investment than Wilhelmina. However, CBIZ Inc is 1.64 times less risky than Wilhelmina. It trades about 0.17 of its potential returns per unit of risk. Wilhelmina is currently generating about -0.11 per unit of risk. If you would invest  6,724  in CBIZ Inc on September 18, 2024 and sell it today you would earn a total of  1,350  from holding CBIZ Inc or generate 20.08% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.44%
Values	Daily Returns

CBIZ Inc  vs.  Wilhelmina

CBIZ Inc

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in CBIZ Inc are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak fundamental drivers, CBIZ showed solid returns over the last few months and may actually be approaching a breakup point.

Wilhelmina

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Wilhelmina has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile performance in the last few months, the Stock's essential indicators remain very healthy which may send shares a bit higher in January 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with CBIZ and Wilhelmina

The main advantage of trading using opposite CBIZ and Wilhelmina positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CBIZ position performs unexpectedly, Wilhelmina 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 Wilhelmina will offset losses from the drop in Wilhelmina's long position.

The idea behind CBIZ Inc and Wilhelmina pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.