Correlation Between SEALED AIR and Identiv
Can any of the company-specific risk be diversified away by investing in both SEALED AIR 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 SEALED AIR and Identiv into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SEALED AIR and Identiv, you can compare the effects of market volatilities on SEALED AIR 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 SEALED AIR with a short position of Identiv. Check out your portfolio center. Please also check ongoing floating volatility patterns of SEALED AIR and Identiv.
Diversification Opportunities for SEALED AIR and Identiv
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between SEALED and Identiv is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding SEALED AIR and Identiv in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Identiv 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 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 SEALED AIR i.e., SEALED AIR and Identiv go up and down completely randomly.
Pair Corralation between SEALED AIR and Identiv
Assuming the 90 days trading horizon SEALED AIR is expected to generate 2.58 times less return on investment than Identiv. But when comparing it to its historical volatility, SEALED AIR is 1.99 times less risky than Identiv. It trades about 0.12 of its potential returns per unit of risk. Identiv is currently generating about 0.15 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 | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SEALED AIR vs. Identiv
Performance |
| Timeline |
| SEALED AIR |
| Identiv |
SEALED AIR and Identiv Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SEALED AIR and Identiv
The main advantage of trading using opposite SEALED AIR and Identiv positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SEALED AIR 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.| SEALED AIR vs. Air Transport Services | SEALED AIR vs. GRIFFIN MINING LTD | SEALED AIR vs. ScanSource | SEALED AIR vs. ANTA SPORTS PRODUCT |
| Identiv vs. SEALED AIR | Identiv vs. WIZZ AIR HLDGUNSPADR4 | Identiv vs. Alaska Air Group | Identiv vs. FORWARD AIR P |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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