Correlation Between Sensient Technologies and I Trax
Can any of the company-specific risk be diversified away by investing in both Sensient Technologies and I Trax 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 Sensient Technologies and I Trax into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sensient Technologies and I Trax Inc, you can compare the effects of market volatilities on Sensient Technologies and I Trax 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 Sensient Technologies with a short position of I Trax. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sensient Technologies and I Trax.
Diversification Opportunities for Sensient Technologies and I Trax
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Sensient and DMX_old is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Sensient Technologies and I Trax Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on I Trax Inc and Sensient Technologies 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 Sensient Technologies are associated (or correlated) with I Trax. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of I Trax Inc has no effect on the direction of Sensient Technologies i.e., Sensient Technologies and I Trax go up and down completely randomly.
Pair Corralation between Sensient Technologies and I Trax
If you would invest 7,343 in Sensient Technologies on October 25, 2024 and sell it today you would earn a total of 226.00 from holding Sensient Technologies or generate 3.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Sensient Technologies vs. I Trax Inc
Performance |
| Timeline |
| Sensient Technologies |
| I Trax Inc |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Sensient Technologies and I Trax Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sensient Technologies and I Trax
The main advantage of trading using opposite Sensient Technologies and I Trax positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sensient Technologies position performs unexpectedly, I Trax 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 I Trax will offset losses from the drop in I Trax's long position.| Sensient Technologies vs. Innospec | Sensient Technologies vs. Minerals Technologies | Sensient Technologies vs. Oil Dri | Sensient Technologies vs. H B Fuller |
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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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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