Correlation Between AerCap Holdings and Willscot Mobile

Can any of the company-specific risk be diversified away by investing in both AerCap Holdings and Willscot Mobile 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 AerCap Holdings and Willscot Mobile into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between AerCap Holdings NV and Willscot Mobile Mini, you can compare the effects of market volatilities on AerCap Holdings and Willscot Mobile 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 AerCap Holdings with a short position of Willscot Mobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of AerCap Holdings and Willscot Mobile.

Diversification Opportunities for AerCap Holdings and Willscot Mobile

-0.31

Correlation Coefficient

AerCap Holdings  Willscot Mobile

Very good diversification

The 3 months correlation between AerCap and Willscot is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding AerCap Holdings NV and Willscot Mobile Mini in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Willscot Mobile Mini and AerCap Holdings 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 AerCap Holdings NV are associated (or correlated) with Willscot Mobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Willscot Mobile Mini has no effect on the direction of AerCap Holdings i.e., AerCap Holdings and Willscot Mobile go up and down completely randomly.

Pair Corralation between AerCap Holdings and Willscot Mobile

Considering the 90-day investment horizon AerCap Holdings NV is expected to generate 0.63 times more return on investment than Willscot Mobile. However, AerCap Holdings NV is 1.59 times less risky than Willscot Mobile. It trades about 0.07 of its potential returns per unit of risk. Willscot Mobile Mini is currently generating about -0.04 per unit of risk. If you would invest  5,560  in AerCap Holdings NV on January 6, 2025 and sell it today you would earn a total of  3,381  from holding AerCap Holdings NV or generate 60.81% return on investment over 90 days.

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

AerCap Holdings NV  vs.  Willscot Mobile Mini

AerCap Holdings NV

Risk-Adjusted Performance

Very Weak

Over the last 90 days AerCap Holdings NV has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable technical and fundamental indicators, AerCap Holdings is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Willscot Mobile Mini

Risk-Adjusted Performance

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 uncertain performance in the last few months, the Stock's basic indicators remain rather sound which may send shares a bit higher in May 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Pair Trading with AerCap Holdings and Willscot Mobile

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

The idea behind AerCap Holdings NV and Willscot Mobile Mini 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.