Correlation Between Sealed Air and Logility Supply
Can any of the company-specific risk be diversified away by investing in both Sealed Air and Logility Supply 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 Logility Supply into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sealed Air and Logility Supply Chain, you can compare the effects of market volatilities on Sealed Air and Logility Supply 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 Logility Supply. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sealed Air and Logility Supply.
Diversification Opportunities for Sealed Air and Logility Supply
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Sealed and Logility is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Sealed Air and Logility Supply Chain in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Logility Supply Chain 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 Logility Supply. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Logility Supply Chain has no effect on the direction of Sealed Air i.e., Sealed Air and Logility Supply go up and down completely randomly.
Pair Corralation between Sealed Air and Logility Supply
Considering the 90-day investment horizon Sealed Air is expected to generate 0.42 times more return on investment than Logility Supply. However, Sealed Air is 2.36 times less risky than Logility Supply. It trades about -0.1 of its potential returns per unit of risk. Logility Supply Chain is currently generating about -0.07 per unit of risk. If you would invest 3,567 in Sealed Air on October 11, 2024 and sell it today you would lose (199.00) from holding Sealed Air or give up 5.58% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sealed Air vs. Logility Supply Chain
Performance |
| Timeline |
| Sealed Air |
| Logility Supply Chain |
Sealed Air and Logility Supply Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sealed Air and Logility Supply
The main advantage of trading using opposite Sealed Air and Logility Supply positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sealed Air position performs unexpectedly, Logility Supply 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 Logility Supply will offset losses from the drop in Logility Supply's long position.| Sealed Air vs. Avery Dennison Corp | Sealed Air vs. International Paper | Sealed Air vs. Sonoco Products | Sealed Air vs. Packaging Corp of |
| Logility Supply vs. Palomar Holdings | Logility Supply vs. Pekin Life Insurance | Logility Supply vs. Sun Life Financial | Logility Supply vs. Molina Healthcare |
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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