Correlation Between Mativ Holdings and Joint Stock
Can any of the company-specific risk be diversified away by investing in both Mativ Holdings and Joint Stock 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 Joint Stock into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mativ Holdings and Joint Stock, you can compare the effects of market volatilities on Mativ Holdings and Joint Stock 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 Joint Stock. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mativ Holdings and Joint Stock.
Diversification Opportunities for Mativ Holdings and Joint Stock
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Mativ and Joint is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Mativ Holdings and Joint Stock in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Joint Stock 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 Joint Stock. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Joint Stock has no effect on the direction of Mativ Holdings i.e., Mativ Holdings and Joint Stock go up and down completely randomly.
Pair Corralation between Mativ Holdings and Joint Stock
Given the investment horizon of 90 days Mativ Holdings is expected to generate 1.78 times more return on investment than Joint Stock. However, Mativ Holdings is 1.78 times more volatile than Joint Stock. It trades about 0.03 of its potential returns per unit of risk. Joint Stock is currently generating about 0.04 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 109.00 from holding Mativ Holdings or generate 9.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 94.74% |
| Values | Daily Returns |
Mativ Holdings vs. Joint Stock
Performance |
| Timeline |
| Mativ Holdings |
| Joint Stock |
Mativ Holdings and Joint Stock Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mativ Holdings and Joint Stock
The main advantage of trading using opposite Mativ Holdings and Joint Stock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mativ Holdings position performs unexpectedly, Joint Stock 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 Joint Stock will offset losses from the drop in Joint Stock'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 |
| Joint Stock vs. Mativ Holdings | Joint Stock vs. Avient Corp | Joint Stock vs. Eastman Chemical | Joint Stock vs. Ecoloclean Industrs |
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 Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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