Correlation Between Wizz Air and Capital Drilling
Can any of the company-specific risk be diversified away by investing in both Wizz Air and Capital Drilling 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 Wizz Air and Capital Drilling into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wizz Air Holdings and Capital Drilling, you can compare the effects of market volatilities on Wizz Air and Capital Drilling 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 Wizz Air with a short position of Capital Drilling. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wizz Air and Capital Drilling.
Diversification Opportunities for Wizz Air and Capital Drilling
-0.91 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Wizz and Capital is -0.91. Overlapping area represents the amount of risk that can be diversified away by holding Wizz Air Holdings and Capital Drilling in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Capital Drilling and Wizz Air 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 Wizz Air Holdings are associated (or correlated) with Capital Drilling. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Capital Drilling has no effect on the direction of Wizz Air i.e., Wizz Air and Capital Drilling go up and down completely randomly.
Pair Corralation between Wizz Air and Capital Drilling
Assuming the 90 days trading horizon Wizz Air Holdings is expected to under-perform the Capital Drilling. But the stock apears to be less risky and, when comparing its historical volatility, Wizz Air Holdings is 1.3 times less risky than Capital Drilling. The stock trades about -0.2 of its potential returns per unit of risk. The Capital Drilling is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 9,080 in Capital Drilling on August 19, 2025 and sell it today you would earn a total of 2,520 from holding Capital Drilling or generate 27.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wizz Air Holdings vs. Capital Drilling
Performance |
| Timeline |
| Wizz Air Holdings |
| Capital Drilling |
Wizz Air and Capital Drilling Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wizz Air and Capital Drilling
The main advantage of trading using opposite Wizz Air and Capital Drilling positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wizz Air position performs unexpectedly, Capital Drilling 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 Capital Drilling will offset losses from the drop in Capital Drilling's long position.| Wizz Air vs. Flutter Entertainment PLC | Wizz Air vs. Ferguson Plc | Wizz Air vs. Marwyn Value Investors | Wizz Air vs. Games Workshop Group |
| Capital Drilling vs. Hilton Food Group | Capital Drilling vs. Grieg Seafood | Capital Drilling vs. Odyssean Investment Trust | Capital Drilling vs. Dairy Farm International |
Check out your portfolio center.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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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