Correlation Between Identiv and Prosiebensat
Can any of the company-specific risk be diversified away by investing in both Identiv and Prosiebensat 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 Prosiebensat into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Identiv and Prosiebensat 1 Media, you can compare the effects of market volatilities on Identiv and Prosiebensat 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 Prosiebensat. Check out your portfolio center. Please also check ongoing floating volatility patterns of Identiv and Prosiebensat.
Diversification Opportunities for Identiv and Prosiebensat
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Identiv and Prosiebensat is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Identiv and Prosiebensat 1 Media in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Prosiebensat 1 Media 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 Prosiebensat. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Prosiebensat 1 Media has no effect on the direction of Identiv i.e., Identiv and Prosiebensat go up and down completely randomly.
Pair Corralation between Identiv and Prosiebensat
Assuming the 90 days trading horizon Identiv is expected to generate 1.57 times more return on investment than Prosiebensat. However, Identiv is 1.57 times more volatile than Prosiebensat 1 Media. It trades about 0.18 of its potential returns per unit of risk. Prosiebensat 1 Media is currently generating about -0.43 per unit of risk. If you would invest 320.00 in Identiv on September 1, 2024 and sell it today you would earn a total of 40.00 from holding Identiv or generate 12.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Identiv vs. Prosiebensat 1 Media
Performance |
| Timeline |
| Identiv |
| Prosiebensat 1 Media |
Identiv and Prosiebensat Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Identiv and Prosiebensat
The main advantage of trading using opposite Identiv and Prosiebensat positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Identiv position performs unexpectedly, Prosiebensat 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 Prosiebensat will offset losses from the drop in Prosiebensat's long position.| Identiv vs. ANTA SPORTS PRODUCT | Identiv vs. PLAYTIKA HOLDING DL 01 | Identiv vs. CNVISION MEDIA | Identiv vs. PARKEN Sport Entertainment |
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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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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