Correlation Between Greif Bros and Imaflex
Can any of the company-specific risk be diversified away by investing in both Greif Bros and Imaflex 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 Greif Bros and Imaflex into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Greif Bros and Imaflex, you can compare the effects of market volatilities on Greif Bros and Imaflex 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 Greif Bros with a short position of Imaflex. Check out your portfolio center. Please also check ongoing floating volatility patterns of Greif Bros and Imaflex.
Diversification Opportunities for Greif Bros and Imaflex
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Greif and Imaflex is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Greif Bros and Imaflex in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Imaflex and Greif Bros 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 Greif Bros are associated (or correlated) with Imaflex. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Imaflex has no effect on the direction of Greif Bros i.e., Greif Bros and Imaflex go up and down completely randomly.
Pair Corralation between Greif Bros and Imaflex
Considering the 90-day investment horizon Greif Bros is expected to generate 5.95 times less return on investment than Imaflex. But when comparing it to its historical volatility, Greif Bros is 1.99 times less risky than Imaflex. It trades about 0.06 of its potential returns per unit of risk. Imaflex is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 52.00 in Imaflex on August 25, 2024 and sell it today you would earn a total of 58.00 from holding Imaflex or generate 111.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.21% |
| Values | Daily Returns |
Greif Bros vs. Imaflex
Performance |
| Timeline |
| Greif Bros |
| Imaflex |
Greif Bros and Imaflex Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Greif Bros and Imaflex
The main advantage of trading using opposite Greif Bros and Imaflex positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Greif Bros position performs unexpectedly, Imaflex 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 Imaflex will offset losses from the drop in Imaflex's long position.| Greif Bros vs. Silgan Holdings | Greif Bros vs. AptarGroup | Greif Bros vs. Sonoco Products | Greif Bros vs. Graphic Packaging Holding |
| Imaflex vs. Karat Packaging | Imaflex vs. NEXE Innovations | Imaflex vs. DSS Inc | Imaflex vs. good natured Products |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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