Correlation Between WILLIS LEASE and SCIENCE IN

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

By analyzing existing cross correlation between WILLIS LEASE FIN and SCIENCE IN SPORT, you can compare the effects of market volatilities on WILLIS LEASE and SCIENCE IN 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 WILLIS LEASE with a short position of SCIENCE IN. Check out your portfolio center. Please also check ongoing floating volatility patterns of WILLIS LEASE and SCIENCE IN.

Diversification Opportunities for WILLIS LEASE and SCIENCE IN

-0.25

Correlation Coefficient

WILLIS LEASE  SCIENCE IN

Very good diversification

The 3 months correlation between WILLIS and SCIENCE is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding WILLIS LEASE FIN and SCIENCE IN SPORT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SCIENCE IN SPORT and WILLIS LEASE 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 WILLIS LEASE FIN are associated (or correlated) with SCIENCE IN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SCIENCE IN SPORT has no effect on the direction of WILLIS LEASE i.e., WILLIS LEASE and SCIENCE IN go up and down completely randomly.

Pair Corralation between WILLIS LEASE and SCIENCE IN

Assuming the 90 days horizon WILLIS LEASE FIN is expected to under-perform the SCIENCE IN. In addition to that, WILLIS LEASE is 1.89 times more volatile than SCIENCE IN SPORT. It trades about 0.0 of its total potential returns per unit of risk. SCIENCE IN SPORT is currently generating about 0.05 per unit of volatility. If you would invest  36.00  in SCIENCE IN SPORT on April 24, 2025 and sell it today you would earn a total of  1.00  from holding SCIENCE IN SPORT or generate 2.78% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	60.32%
Values	Daily Returns

WILLIS LEASE FIN  vs.  SCIENCE IN SPORT

WILLIS LEASE FIN

Risk-Adjusted Performance

Very Weak

Over the last 90 days WILLIS LEASE FIN has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, WILLIS LEASE is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

SCIENCE IN SPORT

Risk-Adjusted Performance

Insignificant

Over the last 90 days SCIENCE IN SPORT has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, SCIENCE IN is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with WILLIS LEASE and SCIENCE IN

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

The idea behind WILLIS LEASE FIN and SCIENCE IN SPORT 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.