Correlation Between Mativ Holdings and Johnson Matthey

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Mativ Holdings and Johnson Matthey 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 Johnson Matthey into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mativ Holdings and Johnson Matthey Plc, you can compare the effects of market volatilities on Mativ Holdings and Johnson Matthey 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 Johnson Matthey. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mativ Holdings and Johnson Matthey.

Diversification Opportunities for Mativ Holdings and Johnson Matthey

0.0
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Mativ and Johnson is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Mativ Holdings and Johnson Matthey Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Johnson Matthey Plc 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 Johnson Matthey. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Johnson Matthey Plc has no effect on the direction of Mativ Holdings i.e., Mativ Holdings and Johnson Matthey go up and down completely randomly.

Pair Corralation between Mativ Holdings and Johnson Matthey

Given the investment horizon of 90 days Mativ Holdings is expected to under-perform the Johnson Matthey. In addition to that, Mativ Holdings is 1.11 times more volatile than Johnson Matthey Plc. It trades about -0.03 of its total potential returns per unit of risk. Johnson Matthey Plc is currently generating about -0.03 per unit of volatility. If you would invest  2,750  in Johnson Matthey Plc on November 2, 2024 and sell it today you would lose (750.00) from holding Johnson Matthey Plc or give up 27.27% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy37.04%
ValuesDaily Returns

Mativ Holdings  vs.  Johnson Matthey Plc

 Performance 
       Timeline  
Mativ Holdings 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Mativ Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in March 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.
Johnson Matthey Plc 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Johnson Matthey Plc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable essential indicators, Johnson Matthey is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Mativ Holdings and Johnson Matthey Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Mativ Holdings and Johnson Matthey

The main advantage of trading using opposite Mativ Holdings and Johnson Matthey positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mativ Holdings position performs unexpectedly, Johnson Matthey 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 Johnson Matthey will offset losses from the drop in Johnson Matthey's long position.
The idea behind Mativ Holdings and Johnson Matthey Plc pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.

Other Complementary Tools

Sync Your Broker
Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors.
Portfolio Analyzer
Portfolio analysis module that provides access to portfolio diagnostics and optimization engine
Money Flow Index
Determine momentum by analyzing Money Flow Index and other technical indicators
Volatility Analysis
Get historical volatility and risk analysis based on latest market data
Price Exposure Probability
Analyze equity upside and downside potential for a given time horizon across multiple markets