Correlation Between Silgan Holdings and Pactiv Evergreen
Can any of the company-specific risk be diversified away by investing in both Silgan Holdings and Pactiv Evergreen 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 Silgan Holdings and Pactiv Evergreen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Silgan Holdings and Pactiv Evergreen, you can compare the effects of market volatilities on Silgan Holdings and Pactiv Evergreen 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 Silgan Holdings with a short position of Pactiv Evergreen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Silgan Holdings and Pactiv Evergreen.
Diversification Opportunities for Silgan Holdings and Pactiv Evergreen
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Silgan and Pactiv is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Silgan Holdings and Pactiv Evergreen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pactiv Evergreen and Silgan Holdings 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 Silgan Holdings are associated (or correlated) with Pactiv Evergreen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pactiv Evergreen has no effect on the direction of Silgan Holdings i.e., Silgan Holdings and Pactiv Evergreen go up and down completely randomly.
Pair Corralation between Silgan Holdings and Pactiv Evergreen
Given the investment horizon of 90 days Silgan Holdings is expected to generate 2.6 times less return on investment than Pactiv Evergreen. But when comparing it to its historical volatility, Silgan Holdings is 1.79 times less risky than Pactiv Evergreen. It trades about 0.02 of its potential returns per unit of risk. Pactiv Evergreen is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 1,111 in Pactiv Evergreen on August 24, 2024 and sell it today you would earn a total of 209.00 from holding Pactiv Evergreen or generate 18.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Silgan Holdings vs. Pactiv Evergreen
Performance |
| Timeline |
| Silgan Holdings |
| Pactiv Evergreen |
Silgan Holdings and Pactiv Evergreen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Silgan Holdings and Pactiv Evergreen
The main advantage of trading using opposite Silgan Holdings and Pactiv Evergreen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Silgan Holdings position performs unexpectedly, Pactiv Evergreen 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 Pactiv Evergreen will offset losses from the drop in Pactiv Evergreen's long position.| Silgan Holdings vs. Pactiv Evergreen | Silgan Holdings vs. Myers Industries | Silgan Holdings vs. Sonoco Products | Silgan Holdings vs. Avery Dennison Corp |
| Pactiv Evergreen vs. Stepstone Group | Pactiv Evergreen vs. Reynolds Consumer Products | Pactiv Evergreen vs. Broadstone Net Lease | Pactiv Evergreen vs. Pmv Pharmaceuticals |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
Other Complementary Tools
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios |