Correlation Between NetApp and Identiv
Can any of the company-specific risk be diversified away by investing in both NetApp 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 NetApp and Identiv into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NetApp Inc and Identiv, you can compare the effects of market volatilities on NetApp 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 NetApp with a short position of Identiv. Check out your portfolio center. Please also check ongoing floating volatility patterns of NetApp and Identiv.
Diversification Opportunities for NetApp and Identiv
Very poor diversification
The 3 months correlation between NetApp and Identiv is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding NetApp Inc and Identiv in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Identiv and NetApp 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 NetApp Inc 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 NetApp i.e., NetApp and Identiv go up and down completely randomly.
Pair Corralation between NetApp and Identiv
Assuming the 90 days horizon NetApp is expected to generate 2.37 times less return on investment than Identiv. But when comparing it to its historical volatility, NetApp Inc is 1.16 times less risky than Identiv. It trades about 0.1 of its potential returns per unit of risk. Identiv is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 341.00 in Identiv on September 13, 2024 and sell it today you would earn a total of 48.00 from holding Identiv or generate 14.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
NetApp Inc vs. Identiv
Performance |
| Timeline |
| NetApp Inc |
| Identiv |
NetApp and Identiv Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NetApp and Identiv
The main advantage of trading using opposite NetApp and Identiv positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NetApp 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.| NetApp vs. Pure Storage | NetApp vs. Teradata Corp | NetApp vs. Superior Plus Corp | NetApp vs. Origin Agritech |
| Identiv vs. Thai Beverage Public | Identiv vs. Fevertree Drinks PLC | Identiv vs. CECO ENVIRONMENTAL | Identiv vs. THAI BEVERAGE |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
Other Complementary Tools
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| CEOs Directory Screen CEOs from public companies around the world |