Correlation Between Meiko Electronics and Identiv
Can any of the company-specific risk be diversified away by investing in both Meiko Electronics and Identiv 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 Meiko Electronics and Identiv into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Meiko Electronics Co and Identiv, you can compare the effects of market volatilities on Meiko Electronics and Identiv 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 Meiko Electronics with a short position of Identiv. Check out your portfolio center. Please also check ongoing floating volatility patterns of Meiko Electronics and Identiv.
Diversification Opportunities for Meiko Electronics and Identiv
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Meiko and Identiv is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Meiko Electronics Co and Identiv in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Identiv and Meiko Electronics 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 Meiko Electronics Co are associated (or correlated) with Identiv. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Identiv has no effect on the direction of Meiko Electronics i.e., Meiko Electronics and Identiv go up and down completely randomly.
Pair Corralation between Meiko Electronics and Identiv
Assuming the 90 days horizon Meiko Electronics Co is expected to generate 0.5 times more return on investment than Identiv. However, Meiko Electronics Co is 2.0 times less risky than Identiv. It trades about -0.02 of its potential returns per unit of risk. Identiv is currently generating about -0.01 per unit of risk. If you would invest 5,450 in Meiko Electronics Co on October 23, 2024 and sell it today you would lose (100.00) from holding Meiko Electronics Co or give up 1.83% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Meiko Electronics Co vs. Identiv
Performance |
| Timeline |
| Meiko Electronics |
| Identiv |
Meiko Electronics and Identiv Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Meiko Electronics and Identiv
The main advantage of trading using opposite Meiko Electronics and Identiv positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Meiko Electronics position performs unexpectedly, Identiv 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 Identiv will offset losses from the drop in Identiv's long position.| Meiko Electronics vs. ASM Pacific Technology | Meiko Electronics vs. X FAB Silicon Foundries | Meiko Electronics vs. G III Apparel Group | Meiko Electronics vs. FANDIFI TECHNOLOGY P |
| Identiv vs. UNITED RENTALS | Identiv vs. Meiko Electronics Co | Identiv vs. WILLIS LEASE FIN | Identiv vs. LOANDEPOT INC A |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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