Correlation Between Sealed Air and Cellnex Telecom
Can any of the company-specific risk be diversified away by investing in both Sealed Air and Cellnex Telecom 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 Sealed Air and Cellnex Telecom into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sealed Air Corp and Cellnex Telecom SA, you can compare the effects of market volatilities on Sealed Air and Cellnex Telecom 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 Sealed Air with a short position of Cellnex Telecom. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sealed Air and Cellnex Telecom.
Diversification Opportunities for Sealed Air and Cellnex Telecom
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Sealed and Cellnex is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Sealed Air Corp and Cellnex Telecom SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cellnex Telecom SA and Sealed 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 Sealed Air Corp are associated (or correlated) with Cellnex Telecom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cellnex Telecom SA has no effect on the direction of Sealed Air i.e., Sealed Air and Cellnex Telecom go up and down completely randomly.
Pair Corralation between Sealed Air and Cellnex Telecom
Assuming the 90 days trading horizon Sealed Air Corp is expected to generate 0.89 times more return on investment than Cellnex Telecom. However, Sealed Air Corp is 1.13 times less risky than Cellnex Telecom. It trades about -0.18 of its potential returns per unit of risk. Cellnex Telecom SA is currently generating about -0.42 per unit of risk. If you would invest 3,626 in Sealed Air Corp on October 12, 2024 and sell it today you would lose (199.00) from holding Sealed Air Corp or give up 5.49% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sealed Air Corp vs. Cellnex Telecom SA
Performance |
| Timeline |
| Sealed Air Corp |
| Cellnex Telecom SA |
Sealed Air and Cellnex Telecom Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sealed Air and Cellnex Telecom
The main advantage of trading using opposite Sealed Air and Cellnex Telecom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sealed Air position performs unexpectedly, Cellnex Telecom 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 Cellnex Telecom will offset losses from the drop in Cellnex Telecom's long position.| Sealed Air vs. Cellnex Telecom SA | Sealed Air vs. Aeorema Communications Plc | Sealed Air vs. Litigation Capital Management | Sealed Air vs. Jupiter Fund Management |
| Cellnex Telecom vs. Metals Exploration Plc | Cellnex Telecom vs. LPKF Laser Electronics | Cellnex Telecom vs. GreenX Metals | Cellnex Telecom vs. Wheaton Precious Metals |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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