Correlation Between Applied Materials and Identiv
Can any of the company-specific risk be diversified away by investing in both Applied Materials 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 Applied Materials and Identiv into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Applied Materials and Identiv, you can compare the effects of market volatilities on Applied Materials 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 Applied Materials with a short position of Identiv. Check out your portfolio center. Please also check ongoing floating volatility patterns of Applied Materials and Identiv.
Diversification Opportunities for Applied Materials and Identiv
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Applied and Identiv is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Applied Materials and Identiv in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Identiv and Applied Materials 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 Applied Materials 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 Applied Materials i.e., Applied Materials and Identiv go up and down completely randomly.
Pair Corralation between Applied Materials and Identiv
Assuming the 90 days horizon Applied Materials is expected to under-perform the Identiv. But the stock apears to be less risky and, when comparing its historical volatility, Applied Materials is 1.26 times less risky than Identiv. The stock trades about -0.12 of its potential returns per unit of risk. The Identiv is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 337.00 in Identiv on August 25, 2024 and sell it today you would earn a total of 9.00 from holding Identiv or generate 2.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Applied Materials vs. Identiv
Performance |
| Timeline |
| Applied Materials |
| Identiv |
Applied Materials and Identiv Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Applied Materials and Identiv
The main advantage of trading using opposite Applied Materials and Identiv positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Applied Materials 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.| Applied Materials vs. Beazer Homes USA | Applied Materials vs. INVITATION HOMES DL | Applied Materials vs. SOUTHWEST AIRLINES | Applied Materials vs. HomeToGo SE |
| Identiv vs. MIRAMAR HOTEL INV | Identiv vs. DALATA HOTEL | Identiv vs. Hyatt Hotels | Identiv vs. MHP Hotel AG |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
Other Complementary Tools
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Stocks Directory Find actively traded stocks across global markets |