Correlation Between Pentair Plc and SEALED AIR
Can any of the company-specific risk be diversified away by investing in both Pentair Plc 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 Pentair Plc and SEALED AIR into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pentair plc and SEALED AIR , you can compare the effects of market volatilities on Pentair Plc 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 Pentair Plc with a short position of SEALED AIR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pentair Plc and SEALED AIR.
Diversification Opportunities for Pentair Plc and SEALED AIR
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Pentair and SEALED is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Pentair plc and SEALED AIR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SEALED AIR and Pentair Plc 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 Pentair plc 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 Pentair Plc i.e., Pentair Plc and SEALED AIR go up and down completely randomly.
Pair Corralation between Pentair Plc and SEALED AIR
Assuming the 90 days horizon Pentair plc is expected to generate 0.94 times more return on investment than SEALED AIR. However, Pentair plc is 1.06 times less risky than SEALED AIR. It trades about 0.12 of its potential returns per unit of risk. SEALED AIR is currently generating about 0.04 per unit of risk. If you would invest 7,134 in Pentair plc on September 1, 2024 and sell it today you would earn a total of 3,181 from holding Pentair plc or generate 44.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pentair plc vs. SEALED AIR
Performance |
| Timeline |
| Pentair plc |
| SEALED AIR |
Pentair Plc and SEALED AIR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pentair Plc and SEALED AIR
The main advantage of trading using opposite Pentair Plc and SEALED AIR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pentair Plc 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.| Pentair Plc vs. ECHO INVESTMENT ZY | Pentair Plc vs. MGIC INVESTMENT | Pentair Plc vs. New Residential Investment | Pentair Plc vs. Strategic Investments AS |
| SEALED AIR vs. SIVERS SEMICONDUCTORS AB | SEALED AIR vs. Darden Restaurants | SEALED AIR vs. Reliance Steel Aluminum | SEALED AIR vs. Q2M Managementberatung AG |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
Other Complementary Tools
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios |