Correlation Between Sealed Air and Silgan Holdings
Can any of the company-specific risk be diversified away by investing in both Sealed Air and Silgan Holdings 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 Silgan Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sealed Air and Silgan Holdings, you can compare the effects of market volatilities on Sealed Air and Silgan Holdings 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 Silgan Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sealed Air and Silgan Holdings.
Diversification Opportunities for Sealed Air and Silgan Holdings
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Sealed and Silgan is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Sealed Air and Silgan Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Silgan Holdings 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 Silgan Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Silgan Holdings has no effect on the direction of Sealed Air i.e., Sealed Air and Silgan Holdings go up and down completely randomly.
Pair Corralation between Sealed Air and Silgan Holdings
Considering the 90-day investment horizon Sealed Air is expected to under-perform the Silgan Holdings. In addition to that, Sealed Air is 1.32 times more volatile than Silgan Holdings. It trades about -0.05 of its total potential returns per unit of risk. Silgan Holdings is currently generating about 0.05 per unit of volatility. If you would invest 5,121 in Silgan Holdings on October 20, 2024 and sell it today you would earn a total of 140.00 from holding Silgan Holdings or generate 2.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sealed Air vs. Silgan Holdings
Performance |
| Timeline |
| Sealed Air |
| Silgan Holdings |
Sealed Air and Silgan Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sealed Air and Silgan Holdings
The main advantage of trading using opposite Sealed Air and Silgan Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sealed Air position performs unexpectedly, Silgan Holdings 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 Silgan Holdings will offset losses from the drop in Silgan Holdings' long position.| Sealed Air vs. Avery Dennison Corp | Sealed Air vs. International Paper | Sealed Air vs. Sonoco Products | Sealed Air vs. Packaging Corp of |
| Silgan Holdings vs. Pactiv Evergreen | Silgan Holdings vs. Myers Industries | Silgan Holdings vs. Sonoco Products | Silgan Holdings vs. Avery Dennison Corp |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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