Correlation Between Wayside Technology and Air Liquide

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

By analyzing existing cross correlation between Wayside Technology Group and Air Liquide SA, you can compare the effects of market volatilities on Wayside Technology and Air Liquide 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 Wayside Technology with a short position of Air Liquide. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wayside Technology and Air Liquide.

Diversification Opportunities for Wayside Technology and Air Liquide

-0.61

Correlation Coefficient

Wayside Technology  Air Liquide

Excellent diversification

The 3 months correlation between Wayside and Air is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Wayside Technology Group and Air Liquide SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Air Liquide SA and Wayside Technology 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 Wayside Technology Group are associated (or correlated) with Air Liquide. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Air Liquide SA has no effect on the direction of Wayside Technology i.e., Wayside Technology and Air Liquide go up and down completely randomly.

Pair Corralation between Wayside Technology and Air Liquide

Assuming the 90 days horizon Wayside Technology Group is expected to under-perform the Air Liquide. In addition to that, Wayside Technology is 2.82 times more volatile than Air Liquide SA. It trades about -0.07 of its total potential returns per unit of risk. Air Liquide SA is currently generating about 0.19 per unit of volatility. If you would invest  15,500  in Air Liquide SA on December 30, 2024 and sell it today you would earn a total of  2,138  from holding Air Liquide SA or generate 13.79% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Wayside Technology Group  vs.  Air Liquide SA

Wayside Technology

Risk-Adjusted Performance

Very Weak

Over the last 90 days Wayside Technology Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unsteady performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Air Liquide SA

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Air Liquide SA are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain essential indicators, Air Liquide unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Wayside Technology and Air Liquide

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

The idea behind Wayside Technology Group and Air Liquide SA 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.