Correlation Between SEALED AIR and SOGECLAIR
Can any of the company-specific risk be diversified away by investing in both SEALED AIR and SOGECLAIR 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 SEALED AIR and SOGECLAIR into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SEALED AIR and SOGECLAIR SA INH, you can compare the effects of market volatilities on SEALED AIR and SOGECLAIR 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 SEALED AIR with a short position of SOGECLAIR. Check out your portfolio center. Please also check ongoing floating volatility patterns of SEALED AIR and SOGECLAIR.
Diversification Opportunities for SEALED AIR and SOGECLAIR
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between SEALED and SOGECLAIR is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding SEALED AIR and SOGECLAIR SA INH in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SOGECLAIR SA INH and SEALED AIR 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 SEALED AIR are associated (or correlated) with SOGECLAIR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SOGECLAIR SA INH has no effect on the direction of SEALED AIR i.e., SEALED AIR and SOGECLAIR go up and down completely randomly.
Pair Corralation between SEALED AIR and SOGECLAIR
Assuming the 90 days trading horizon SEALED AIR is expected to generate 0.61 times more return on investment than SOGECLAIR. However, SEALED AIR is 1.63 times less risky than SOGECLAIR. It trades about 0.0 of its potential returns per unit of risk. SOGECLAIR SA INH is currently generating about -0.05 per unit of risk. If you would invest 3,417 in SEALED AIR on October 25, 2024 and sell it today you would lose (57.00) from holding SEALED AIR or give up 1.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SEALED AIR vs. SOGECLAIR SA INH
Performance |
| Timeline |
| SEALED AIR |
| SOGECLAIR SA INH |
SEALED AIR and SOGECLAIR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SEALED AIR and SOGECLAIR
The main advantage of trading using opposite SEALED AIR and SOGECLAIR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SEALED AIR position performs unexpectedly, SOGECLAIR 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 SOGECLAIR will offset losses from the drop in SOGECLAIR's long position.The idea behind SEALED AIR and SOGECLAIR SA INH pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| SOGECLAIR vs. NTG Nordic Transport | SOGECLAIR vs. SOEDER SPORTFISKE AB | SOGECLAIR vs. SEI INVESTMENTS | SOGECLAIR vs. PennyMac Mortgage Investment |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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