Correlation Between Lion One and Sealed Air
Can any of the company-specific risk be diversified away by investing in both Lion One and Sealed Air 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 Lion One and Sealed Air into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lion One Metals and Sealed Air, you can compare the effects of market volatilities on Lion One and Sealed Air 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 Lion One with a short position of Sealed Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lion One and Sealed Air.
Diversification Opportunities for Lion One and Sealed Air
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Lion and Sealed is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Lion One Metals and Sealed Air in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sealed Air and Lion One 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 Lion One Metals are associated (or correlated) with Sealed Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sealed Air has no effect on the direction of Lion One i.e., Lion One and Sealed Air go up and down completely randomly.
Pair Corralation between Lion One and Sealed Air
Assuming the 90 days horizon Lion One Metals is expected to under-perform the Sealed Air. In addition to that, Lion One is 1.93 times more volatile than Sealed Air. It trades about -0.04 of its total potential returns per unit of risk. Sealed Air is currently generating about 0.01 per unit of volatility. If you would invest 3,753 in Sealed Air on September 1, 2024 and sell it today you would lose (93.00) from holding Sealed Air or give up 2.48% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lion One Metals vs. Sealed Air
Performance |
| Timeline |
| Lion One Metals |
| Sealed Air |
Lion One and Sealed Air Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lion One and Sealed Air
The main advantage of trading using opposite Lion One and Sealed Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lion One position performs unexpectedly, Sealed Air 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 Sealed Air will offset losses from the drop in Sealed Air's long position.| Lion One vs. Irving Resources | Lion One vs. Headwater Gold | Lion One vs. Novo Resources Corp | Lion One vs. Snowline Gold Corp |
| Sealed Air vs. Packaging Corp of | Sealed Air vs. O I Glass | Sealed Air vs. Silgan Holdings | Sealed Air vs. International Paper |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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