Correlation Between Willscot Mobile and ICC Holdings

Can any of the company-specific risk be diversified away by investing in both Willscot Mobile and ICC Holdings 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 ICC Holdings 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 ICC Holdings, you can compare the effects of market volatilities on Willscot Mobile and ICC Holdings 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 ICC Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Willscot Mobile and ICC Holdings.

Diversification Opportunities for Willscot Mobile and ICC Holdings

-0.55

Correlation Coefficient

Willscot Mobile  ICC Holdings

Excellent diversification

The 3 months correlation between Willscot and ICC is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Willscot Mobile Mini and ICC Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ICC Holdings 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 ICC Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ICC Holdings has no effect on the direction of Willscot Mobile i.e., Willscot Mobile and ICC Holdings go up and down completely randomly.

Pair Corralation between Willscot Mobile and ICC Holdings

Considering the 90-day investment horizon Willscot Mobile Mini is expected to generate 1.5 times more return on investment than ICC Holdings. However, Willscot Mobile is 1.5 times more volatile than ICC Holdings. It trades about 0.44 of its potential returns per unit of risk. ICC Holdings is currently generating about -0.02 per unit of risk. If you would invest  3,293  in Willscot Mobile Mini on October 20, 2024 and sell it today you would earn a total of  371.00  from holding Willscot Mobile Mini or generate 11.27% return on investment over 90 days.

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

Willscot Mobile Mini  vs.  ICC Holdings

Willscot Mobile Mini

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Willscot Mobile Mini has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Willscot Mobile is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

ICC Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ICC Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong fundamental indicators, ICC Holdings is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Willscot Mobile and ICC Holdings

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

The idea behind Willscot Mobile Mini and ICC Holdings 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.