Correlation Between Wilh Wilhelmsen and ADS Maritime

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

By analyzing existing cross correlation between Wilh Wilhelmsen Holding and ADS Maritime Holding, you can compare the effects of market volatilities on Wilh Wilhelmsen and ADS Maritime 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 Wilh Wilhelmsen with a short position of ADS Maritime. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wilh Wilhelmsen and ADS Maritime.

Diversification Opportunities for Wilh Wilhelmsen and ADS Maritime

0.6

Correlation Coefficient

Wilh Wilhelmsen  ADS Maritime

Poor diversification

The 3 months correlation between Wilh and ADS is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Wilh Wilhelmsen Holding and ADS Maritime Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ADS Maritime Holding and Wilh Wilhelmsen 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 Wilh Wilhelmsen Holding are associated (or correlated) with ADS Maritime. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ADS Maritime Holding has no effect on the direction of Wilh Wilhelmsen i.e., Wilh Wilhelmsen and ADS Maritime go up and down completely randomly.

Pair Corralation between Wilh Wilhelmsen and ADS Maritime

Assuming the 90 days trading horizon Wilh Wilhelmsen Holding is expected to generate 0.56 times more return on investment than ADS Maritime. However, Wilh Wilhelmsen Holding is 1.8 times less risky than ADS Maritime. It trades about 0.29 of its potential returns per unit of risk. ADS Maritime Holding is currently generating about 0.03 per unit of risk. If you would invest  34,533  in Wilh Wilhelmsen Holding on April 25, 2025 and sell it today you would earn a total of  9,567  from holding Wilh Wilhelmsen Holding or generate 27.7% return on investment over 90 days.

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

Wilh Wilhelmsen Holding  vs.  ADS Maritime Holding

Wilh Wilhelmsen Holding

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Wilh Wilhelmsen Holding are ranked lower than 22 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting essential indicators, Wilh Wilhelmsen disclosed solid returns over the last few months and may actually be approaching a breakup point.

ADS Maritime Holding

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in ADS Maritime Holding are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent basic indicators, ADS Maritime is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with Wilh Wilhelmsen and ADS Maritime

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

The idea behind Wilh Wilhelmsen Holding and ADS Maritime Holding 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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.