Correlation Between GOODYEAR T and Identiv
Can any of the company-specific risk be diversified away by investing in both GOODYEAR T 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 GOODYEAR T and Identiv into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GOODYEAR T RUBBER and Identiv, you can compare the effects of market volatilities on GOODYEAR T 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 GOODYEAR T with a short position of Identiv. Check out your portfolio center. Please also check ongoing floating volatility patterns of GOODYEAR T and Identiv.
Diversification Opportunities for GOODYEAR T and Identiv
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between GOODYEAR and Identiv is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding GOODYEAR T RUBBER and Identiv in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Identiv and GOODYEAR T 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 GOODYEAR T RUBBER 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 GOODYEAR T i.e., GOODYEAR T and Identiv go up and down completely randomly.
Pair Corralation between GOODYEAR T and Identiv
Assuming the 90 days trading horizon GOODYEAR T RUBBER is expected to generate 1.09 times more return on investment than Identiv. However, GOODYEAR T is 1.09 times more volatile than Identiv. It trades about 0.14 of its potential returns per unit of risk. Identiv is currently generating about 0.12 per unit of risk. If you would invest 789.00 in GOODYEAR T RUBBER on September 2, 2024 and sell it today you would earn a total of 225.00 from holding GOODYEAR T RUBBER or generate 28.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
GOODYEAR T RUBBER vs. Identiv
Performance |
| Timeline |
| GOODYEAR T RUBBER |
| Identiv |
GOODYEAR T and Identiv Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GOODYEAR T and Identiv
The main advantage of trading using opposite GOODYEAR T and Identiv positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GOODYEAR T 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.| GOODYEAR T vs. Uber Technologies | GOODYEAR T vs. Sixt Leasing SE | GOODYEAR T vs. Lendlease Group | GOODYEAR T vs. Nucletron Electronic Aktiengesellschaft |
| Identiv vs. SBA Communications Corp | Identiv vs. Verizon Communications | Identiv vs. Iridium Communications | Identiv vs. THORNEY TECHS LTD |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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