Correlation Between PATTIES FOODS and SEALED AIR
Can any of the company-specific risk be diversified away by investing in both PATTIES FOODS and SEALED AIR 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 PATTIES FOODS and SEALED AIR into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PATTIES FOODS and SEALED AIR , you can compare the effects of market volatilities on PATTIES FOODS and SEALED AIR 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 PATTIES FOODS with a short position of SEALED AIR. Check out your portfolio center. Please also check ongoing floating volatility patterns of PATTIES FOODS and SEALED AIR.
Diversification Opportunities for PATTIES FOODS and SEALED AIR
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between PATTIES and SEALED is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding PATTIES FOODS and SEALED AIR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SEALED AIR and PATTIES FOODS 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 PATTIES FOODS are associated (or correlated) with SEALED AIR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SEALED AIR has no effect on the direction of PATTIES FOODS i.e., PATTIES FOODS and SEALED AIR go up and down completely randomly.
Pair Corralation between PATTIES FOODS and SEALED AIR
Assuming the 90 days horizon PATTIES FOODS is expected to generate 3.18 times more return on investment than SEALED AIR. However, PATTIES FOODS is 3.18 times more volatile than SEALED AIR . It trades about 0.06 of its potential returns per unit of risk. SEALED AIR is currently generating about 0.01 per unit of risk. If you would invest 18.00 in PATTIES FOODS on November 7, 2024 and sell it today you would earn a total of 10.00 from holding PATTIES FOODS or generate 55.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.2% |
| Values | Daily Returns |
PATTIES FOODS vs. SEALED AIR
Performance |
| Timeline |
| PATTIES FOODS |
| SEALED AIR |
PATTIES FOODS and SEALED AIR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PATTIES FOODS and SEALED AIR
The main advantage of trading using opposite PATTIES FOODS and SEALED AIR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PATTIES FOODS position performs unexpectedly, SEALED AIR 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 SEALED AIR will offset losses from the drop in SEALED AIR's long position.| PATTIES FOODS vs. Zoom Video Communications | PATTIES FOODS vs. GLG LIFE TECH | PATTIES FOODS vs. Bio Techne Corp | PATTIES FOODS vs. Arrow Electronics |
| SEALED AIR vs. Playtech plc | SEALED AIR vs. Firan Technology Group | SEALED AIR vs. National Retail Properties | SEALED AIR vs. CARSALESCOM |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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