Correlation Between Ping An and Identiv
Can any of the company-specific risk be diversified away by investing in both Ping An 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 Ping An and Identiv into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ping An Insurance and Identiv, you can compare the effects of market volatilities on Ping An 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 Ping An with a short position of Identiv. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ping An and Identiv.
Diversification Opportunities for Ping An and Identiv
Very weak diversification
The 3 months correlation between Ping and Identiv is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Ping An Insurance and Identiv in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Identiv and Ping An 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 Ping An Insurance 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 Ping An i.e., Ping An and Identiv go up and down completely randomly.
Pair Corralation between Ping An and Identiv
Assuming the 90 days horizon Ping An Insurance is expected to under-perform the Identiv. But the stock apears to be less risky and, when comparing its historical volatility, Ping An Insurance is 1.25 times less risky than Identiv. The stock trades about -0.01 of its potential returns per unit of risk. The Identiv is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 325.00 in Identiv on September 4, 2024 and sell it today you would earn a total of 35.00 from holding Identiv or generate 10.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Ping An Insurance vs. Identiv
Performance |
| Timeline |
| Ping An Insurance |
| Identiv |
Ping An and Identiv Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ping An and Identiv
The main advantage of trading using opposite Ping An and Identiv positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ping An 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.| Ping An vs. Sanyo Chemical Industries | Ping An vs. CHEMICAL INDUSTRIES | Ping An vs. Silicon Motion Technology | Ping An vs. Wayside Technology Group |
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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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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