Correlation Between SVB Financial and Align Technology
Can any of the company-specific risk be diversified away by investing in both SVB Financial and Align Technology 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 SVB Financial and Align Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SVB Financial Group and Align Technology, you can compare the effects of market volatilities on SVB Financial and Align Technology 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 SVB Financial with a short position of Align Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of SVB Financial and Align Technology.
Diversification Opportunities for SVB Financial and Align Technology
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between SVB and Align is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding SVB Financial Group and Align Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Align Technology and SVB Financial 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 SVB Financial Group are associated (or correlated) with Align Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Align Technology has no effect on the direction of SVB Financial i.e., SVB Financial and Align Technology go up and down completely randomly.
Pair Corralation between SVB Financial and Align Technology
If you would invest 24,360 in Align Technology on November 28, 2024 and sell it today you would earn a total of 4,099 from holding Align Technology or generate 16.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SVB Financial Group vs. Align Technology
Performance |
| Timeline |
| SVB Financial Group |
| Align Technology |
SVB Financial and Align Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SVB Financial and Align Technology
The main advantage of trading using opposite SVB Financial and Align Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SVB Financial position performs unexpectedly, Align Technology 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 Align Technology will offset losses from the drop in Align Technology's long position.| SVB Financial vs. Take Two Interactive Software | SVB Financial vs. MAHLE Metal Leve | SVB Financial vs. Verizon Communications | SVB Financial vs. Host Hotels Resorts, |
| Align Technology vs. Electronic Arts | Align Technology vs. Check Point Software | Align Technology vs. Verizon Communications | Align Technology vs. JB Hunt Transport |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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