Correlation Between Mativ Holdings and Thunder Power
Can any of the company-specific risk be diversified away by investing in both Mativ Holdings and Thunder Power 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 Mativ Holdings and Thunder Power into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mativ Holdings and Thunder Power Holdings,, you can compare the effects of market volatilities on Mativ Holdings and Thunder Power 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 Mativ Holdings with a short position of Thunder Power. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mativ Holdings and Thunder Power.
Diversification Opportunities for Mativ Holdings and Thunder Power
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Mativ and Thunder is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Mativ Holdings and Thunder Power Holdings, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thunder Power Holdings, and Mativ Holdings 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 Mativ Holdings are associated (or correlated) with Thunder Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thunder Power Holdings, has no effect on the direction of Mativ Holdings i.e., Mativ Holdings and Thunder Power go up and down completely randomly.
Pair Corralation between Mativ Holdings and Thunder Power
Given the investment horizon of 90 days Mativ Holdings is expected to generate 0.5 times more return on investment than Thunder Power. However, Mativ Holdings is 2.01 times less risky than Thunder Power. It trades about 0.03 of its potential returns per unit of risk. Thunder Power Holdings, is currently generating about -0.09 per unit of risk. If you would invest 1,166 in Mativ Holdings on September 4, 2024 and sell it today you would earn a total of 169.00 from holding Mativ Holdings or generate 14.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mativ Holdings vs. Thunder Power Holdings,
Performance |
| Timeline |
| Mativ Holdings |
| Thunder Power Holdings, |
Mativ Holdings and Thunder Power Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mativ Holdings and Thunder Power
The main advantage of trading using opposite Mativ Holdings and Thunder Power positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mativ Holdings position performs unexpectedly, Thunder Power 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 Thunder Power will offset losses from the drop in Thunder Power's long position.| Mativ Holdings vs. Orion Engineered Carbons | Mativ Holdings vs. Select Energy Services | Mativ Holdings vs. Perimeter Solutions SA | Mativ Holdings vs. FutureFuel Corp |
| Thunder Power vs. Corporacion America Airports | Thunder Power vs. Porvair plc | Thunder Power vs. Cebu Air ADR | Thunder Power vs. Chemours Co |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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