Correlation Between Mativ Holdings and ServiceNow
Can any of the company-specific risk be diversified away by investing in both Mativ Holdings and ServiceNow 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 ServiceNow into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mativ Holdings and ServiceNow, you can compare the effects of market volatilities on Mativ Holdings and ServiceNow 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 ServiceNow. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mativ Holdings and ServiceNow.
Diversification Opportunities for Mativ Holdings and ServiceNow
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Mativ and ServiceNow is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Mativ Holdings and ServiceNow in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ServiceNow 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 ServiceNow. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ServiceNow has no effect on the direction of Mativ Holdings i.e., Mativ Holdings and ServiceNow go up and down completely randomly.
Pair Corralation between Mativ Holdings and ServiceNow
Given the investment horizon of 90 days Mativ Holdings is expected to under-perform the ServiceNow. In addition to that, Mativ Holdings is 1.46 times more volatile than ServiceNow. It trades about -0.49 of its total potential returns per unit of risk. ServiceNow is currently generating about -0.01 per unit of volatility. If you would invest 107,487 in ServiceNow on October 20, 2024 and sell it today you would lose (339.00) from holding ServiceNow or give up 0.32% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mativ Holdings vs. ServiceNow
Performance |
| Timeline |
| Mativ Holdings |
| ServiceNow |
Mativ Holdings and ServiceNow Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mativ Holdings and ServiceNow
The main advantage of trading using opposite Mativ Holdings and ServiceNow positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mativ Holdings position performs unexpectedly, ServiceNow 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 ServiceNow will offset losses from the drop in ServiceNow'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 |
| ServiceNow vs. Autodesk | ServiceNow vs. Intuit Inc | ServiceNow vs. Zoom Video Communications | ServiceNow vs. Snowflake |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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