Correlation Between Identiv and Pure Storage
Can any of the company-specific risk be diversified away by investing in both Identiv and Pure Storage 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 Identiv and Pure Storage into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Identiv and Pure Storage, you can compare the effects of market volatilities on Identiv and Pure Storage 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 Identiv with a short position of Pure Storage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Identiv and Pure Storage.
Diversification Opportunities for Identiv and Pure Storage
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Identiv and Pure is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Identiv and Pure Storage in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pure Storage and Identiv 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 Identiv are associated (or correlated) with Pure Storage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pure Storage has no effect on the direction of Identiv i.e., Identiv and Pure Storage go up and down completely randomly.
Pair Corralation between Identiv and Pure Storage
Assuming the 90 days trading horizon Identiv is expected to under-perform the Pure Storage. In addition to that, Identiv is 1.38 times more volatile than Pure Storage. It trades about -0.01 of its total potential returns per unit of risk. Pure Storage is currently generating about 0.05 per unit of volatility. 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 |
Identiv vs. Pure Storage
Performance |
| Timeline |
| Identiv |
| Pure Storage |
Identiv and Pure Storage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Identiv and Pure Storage
The main advantage of trading using opposite Identiv and Pure Storage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Identiv position performs unexpectedly, Pure Storage 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 Pure Storage will offset losses from the drop in Pure Storage's long position.| Identiv vs. SEALED AIR | Identiv vs. WIZZ AIR HLDGUNSPADR4 | Identiv vs. Alaska Air Group | Identiv vs. FORWARD AIR P |
| Pure Storage vs. Teradata Corp | Pure Storage vs. Superior Plus Corp | Pure Storage vs. NMI Holdings | Pure Storage vs. Origin Agritech |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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