Correlation Between Sealed Air and Jardine Matheson
Can any of the company-specific risk be diversified away by investing in both Sealed Air and Jardine Matheson 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 Jardine Matheson 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 Jardine Matheson Holdings, you can compare the effects of market volatilities on Sealed Air and Jardine Matheson 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 Jardine Matheson. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sealed Air and Jardine Matheson.
Diversification Opportunities for Sealed Air and Jardine Matheson
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Sealed and Jardine is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Sealed Air Corp and Jardine Matheson Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jardine Matheson Holdings 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 Jardine Matheson. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jardine Matheson Holdings has no effect on the direction of Sealed Air i.e., Sealed Air and Jardine Matheson go up and down completely randomly.
Pair Corralation between Sealed Air and Jardine Matheson
Assuming the 90 days trading horizon Sealed Air Corp is expected to under-perform the Jardine Matheson. In addition to that, Sealed Air is 6.72 times more volatile than Jardine Matheson Holdings. It trades about -0.02 of its total potential returns per unit of risk. Jardine Matheson Holdings is currently generating about 0.04 per unit of volatility. If you would invest 5,816 in Jardine Matheson Holdings on September 14, 2024 and sell it today you would earn a total of 434.00 from holding Jardine Matheson Holdings or generate 7.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 85.51% |
| Values | Daily Returns |
Sealed Air Corp vs. Jardine Matheson Holdings
Performance |
| Timeline |
| Sealed Air Corp |
| Jardine Matheson Holdings |
Sealed Air and Jardine Matheson Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sealed Air and Jardine Matheson
The main advantage of trading using opposite Sealed Air and Jardine Matheson positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sealed Air position performs unexpectedly, Jardine Matheson 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 Jardine Matheson will offset losses from the drop in Jardine Matheson's long position.| Sealed Air vs. Cornish Metals | Sealed Air vs. European Metals Holdings | Sealed Air vs. BW Offshore | Sealed Air vs. Bloomsbury Publishing Plc |
| Jardine Matheson vs. Ryanair Holdings plc | Jardine Matheson vs. Ecofin Global Utilities | Jardine Matheson vs. Fair Oaks Income | Jardine Matheson vs. Sealed Air Corp |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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