Correlation Between SEALED AIR and SEAZEN GROUP
Can any of the company-specific risk be diversified away by investing in both SEALED AIR and SEAZEN GROUP 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 SEAZEN GROUP into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SEALED AIR and SEAZEN GROUP LTD, you can compare the effects of market volatilities on SEALED AIR and SEAZEN GROUP 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 SEAZEN GROUP. Check out your portfolio center. Please also check ongoing floating volatility patterns of SEALED AIR and SEAZEN GROUP.
Diversification Opportunities for SEALED AIR and SEAZEN GROUP
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between SEALED and SEAZEN is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding SEALED AIR and SEAZEN GROUP LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SEAZEN GROUP LTD 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 SEAZEN GROUP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SEAZEN GROUP LTD has no effect on the direction of SEALED AIR i.e., SEALED AIR and SEAZEN GROUP go up and down completely randomly.
Pair Corralation between SEALED AIR and SEAZEN GROUP
Assuming the 90 days trading horizon SEALED AIR is expected to generate 0.35 times more return on investment than SEAZEN GROUP. However, SEALED AIR is 2.88 times less risky than SEAZEN GROUP. It trades about 0.17 of its potential returns per unit of risk. SEAZEN GROUP LTD is currently generating about 0.01 per unit of risk. If you would invest 3,240 in SEALED AIR on November 6, 2024 and sell it today you would earn a total of 120.00 from holding SEALED AIR or generate 3.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
SEALED AIR vs. SEAZEN GROUP LTD
Performance |
| Timeline |
| SEALED AIR |
| SEAZEN GROUP LTD |
SEALED AIR and SEAZEN GROUP Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SEALED AIR and SEAZEN GROUP
The main advantage of trading using opposite SEALED AIR and SEAZEN GROUP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SEALED AIR position performs unexpectedly, SEAZEN GROUP 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 SEAZEN GROUP will offset losses from the drop in SEAZEN GROUP's long position.The idea behind SEALED AIR and SEAZEN GROUP LTD 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.| SEAZEN GROUP vs. Sixt Leasing SE | SEAZEN GROUP vs. PULSION Medical Systems | SEAZEN GROUP vs. FIRST SHIP LEASE | SEAZEN GROUP vs. Global Ship Lease |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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