Correlation Between Wizz Air and MINCO SILVER

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

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

Diversification Opportunities for Wizz Air and MINCO SILVER

0.0

Correlation Coefficient

Wizz Air  MINCO SILVER

Pay attention - limited upside

The 3 months correlation between Wizz and MINCO is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Wizz Air Holdings and MINCO SILVER in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MINCO SILVER and Wizz Air 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 Wizz Air Holdings are associated (or correlated) with MINCO SILVER. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MINCO SILVER has no effect on the direction of Wizz Air i.e., Wizz Air and MINCO SILVER go up and down completely randomly.

Pair Corralation between Wizz Air and MINCO SILVER

Assuming the 90 days trading horizon Wizz Air Holdings is expected to generate 1.01 times more return on investment than MINCO SILVER. However, Wizz Air is 1.01 times more volatile than MINCO SILVER. It trades about 0.1 of its potential returns per unit of risk. MINCO SILVER is currently generating about 0.08 per unit of risk. If you would invest  1,552  in Wizz Air Holdings on November 28, 2024 and sell it today you would earn a total of  322.00  from holding Wizz Air Holdings or generate 20.75% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Wizz Air Holdings  vs.  MINCO SILVER

Wizz Air Holdings

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Wizz Air Holdings are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile basic indicators, Wizz Air unveiled solid returns over the last few months and may actually be approaching a breakup point.

MINCO SILVER

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in MINCO SILVER are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile fundamental indicators, MINCO SILVER unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Wizz Air and MINCO SILVER

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

The idea behind Wizz Air Holdings and MINCO SILVER 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.

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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.