Correlation Between MPC Container and Wallenius Wilhelmsen

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

By analyzing existing cross correlation between MPC Container Ships and Wallenius Wilhelmsen Logistics, you can compare the effects of market volatilities on MPC Container and Wallenius Wilhelmsen 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 MPC Container with a short position of Wallenius Wilhelmsen. Check out your portfolio center. Please also check ongoing floating volatility patterns of MPC Container and Wallenius Wilhelmsen.

Diversification Opportunities for MPC Container and Wallenius Wilhelmsen

0.92

Correlation Coefficient

MPC Container  Wallenius Wilhelmsen

Almost no diversification

The 3 months correlation between MPC and Wallenius is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding MPC Container Ships and Wallenius Wilhelmsen Logistics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wallenius Wilhelmsen and MPC Container 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 MPC Container Ships are associated (or correlated) with Wallenius Wilhelmsen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wallenius Wilhelmsen has no effect on the direction of MPC Container i.e., MPC Container and Wallenius Wilhelmsen go up and down completely randomly.

Pair Corralation between MPC Container and Wallenius Wilhelmsen

Assuming the 90 days trading horizon MPC Container Ships is expected to generate 1.31 times more return on investment than Wallenius Wilhelmsen. However, MPC Container is 1.31 times more volatile than Wallenius Wilhelmsen Logistics. It trades about 0.15 of its potential returns per unit of risk. Wallenius Wilhelmsen Logistics is currently generating about 0.18 per unit of risk. If you would invest  1,438  in MPC Container Ships on April 24, 2025 and sell it today you would earn a total of  385.00  from holding MPC Container Ships or generate 26.77% return on investment over 90 days.

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

MPC Container Ships  vs.  Wallenius Wilhelmsen Logistics

MPC Container Ships

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in MPC Container Ships are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting essential indicators, MPC Container disclosed solid returns over the last few months and may actually be approaching a breakup point.

Wallenius Wilhelmsen

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Wallenius Wilhelmsen Logistics are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite quite unfluctuating essential indicators, Wallenius Wilhelmsen disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with MPC Container and Wallenius Wilhelmsen

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

The idea behind MPC Container Ships and Wallenius Wilhelmsen Logistics 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.