Correlation Between WillScot Mobile and APA
Can any of the company-specific risk be diversified away by investing in both WillScot Mobile and APA 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 WillScot Mobile and APA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WillScot Mobile Mini and APA Group, you can compare the effects of market volatilities on WillScot Mobile and APA 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 WillScot Mobile with a short position of APA. Check out your portfolio center. Please also check ongoing floating volatility patterns of WillScot Mobile and APA.
Diversification Opportunities for WillScot Mobile and APA
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between WillScot and APA is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding WillScot Mobile Mini and APA Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on APA Group and WillScot Mobile 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 WillScot Mobile Mini are associated (or correlated) with APA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of APA Group has no effect on the direction of WillScot Mobile i.e., WillScot Mobile and APA go up and down completely randomly.
Pair Corralation between WillScot Mobile and APA
Assuming the 90 days trading horizon WillScot Mobile Mini is expected to generate 1.3 times more return on investment than APA. However, WillScot Mobile is 1.3 times more volatile than APA Group. It trades about 0.06 of its potential returns per unit of risk. APA Group is currently generating about -0.03 per unit of risk. If you would invest 3,360 in WillScot Mobile Mini on November 22, 2024 and sell it today you would earn a total of 260.00 from holding WillScot Mobile Mini or generate 7.74% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
WillScot Mobile Mini vs. APA Group
Performance |
Timeline |
WillScot Mobile Mini |
APA Group |
WillScot Mobile and APA Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with WillScot Mobile and APA
The main advantage of trading using opposite WillScot Mobile and APA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WillScot Mobile position performs unexpectedly, APA 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 APA will offset losses from the drop in APA's long position.WillScot Mobile vs. VITEC SOFTWARE GROUP | ||
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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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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