Correlation Between Pure Storage and Identiv
Can any of the company-specific risk be diversified away by investing in both Pure Storage and Identiv 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 Pure Storage and Identiv into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pure Storage and Identiv, you can compare the effects of market volatilities on Pure Storage and Identiv 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 Pure Storage with a short position of Identiv. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pure Storage and Identiv.
Diversification Opportunities for Pure Storage and Identiv
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Pure and Identiv is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Pure Storage and Identiv in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Identiv and Pure Storage 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 Pure Storage are associated (or correlated) with Identiv. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Identiv has no effect on the direction of Pure Storage i.e., Pure Storage and Identiv go up and down completely randomly.
Pair Corralation between Pure Storage and Identiv
Assuming the 90 days horizon Pure Storage is expected to generate 0.72 times more return on investment than Identiv. However, Pure Storage is 1.38 times less risky than Identiv. It trades about 0.05 of its potential returns per unit of risk. Identiv is currently generating about -0.01 per unit of risk. If you would invest 2,863 in Pure Storage on September 4, 2024 and sell it today you would earn a total of 2,219 from holding Pure Storage or generate 77.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Pure Storage vs. Identiv
Performance |
| Timeline |
| Pure Storage |
| Identiv |
Pure Storage and Identiv Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pure Storage and Identiv
The main advantage of trading using opposite Pure Storage and Identiv positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pure Storage position performs unexpectedly, Identiv 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 Identiv will offset losses from the drop in Identiv's long position.| Pure Storage vs. Teradata Corp | Pure Storage vs. Superior Plus Corp | Pure Storage vs. NMI Holdings | Pure Storage vs. Origin Agritech |
| Identiv vs. SEALED AIR | Identiv vs. WIZZ AIR HLDGUNSPADR4 | Identiv vs. Alaska Air Group | Identiv vs. FORWARD AIR P |
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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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