Correlation Between Wilhelmina and Criteo Sa

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

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

Diversification Opportunities for Wilhelmina and Criteo Sa

0.68

Correlation Coefficient

Wilhelmina  Criteo Sa

Poor diversification

The 3 months correlation between Wilhelmina and Criteo is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Wilhelmina and Criteo Sa in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Criteo Sa and Wilhelmina 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 Wilhelmina are associated (or correlated) with Criteo Sa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Criteo Sa has no effect on the direction of Wilhelmina i.e., Wilhelmina and Criteo Sa go up and down completely randomly.

Pair Corralation between Wilhelmina and Criteo Sa

Given the investment horizon of 90 days Wilhelmina is expected to generate 1.29 times less return on investment than Criteo Sa. In addition to that, Wilhelmina is 2.56 times more volatile than Criteo Sa. It trades about 0.06 of its total potential returns per unit of risk. Criteo Sa is currently generating about 0.21 per unit of volatility. If you would invest  3,486  in Criteo Sa on October 6, 2024 and sell it today you would earn a total of  644.00  from holding Criteo Sa or generate 18.47% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	97.62%
Values	Daily Returns

Wilhelmina  vs.  Criteo Sa

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 very healthy essential indicators, Wilhelmina is not utilizing all of its potentials. The newest stock price disarray, may contribute to short-term losses for the investors.

Criteo Sa

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Criteo Sa are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of very weak basic indicators, Criteo Sa may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Wilhelmina and Criteo Sa

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

The idea behind Wilhelmina and Criteo 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.