Correlation Between Tesla and Identiv
Can any of the company-specific risk be diversified away by investing in both Tesla 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 Tesla and Identiv into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tesla Inc and Identiv, you can compare the effects of market volatilities on Tesla 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 Tesla with a short position of Identiv. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tesla and Identiv.
Diversification Opportunities for Tesla and Identiv
Poor diversification
The 3 months correlation between Tesla and Identiv is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Tesla Inc and Identiv in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Identiv and Tesla 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 Tesla Inc 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 Tesla i.e., Tesla and Identiv go up and down completely randomly.
Pair Corralation between Tesla and Identiv
Assuming the 90 days horizon Tesla Inc is expected to generate 0.88 times more return on investment than Identiv. However, Tesla Inc is 1.14 times less risky than Identiv. It trades about 0.05 of its potential returns per unit of risk. Identiv is currently generating about -0.02 per unit of risk. If you would invest 17,300 in Tesla Inc on August 24, 2024 and sell it today you would earn a total of 15,195 from holding Tesla Inc or generate 87.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Tesla Inc vs. Identiv
Performance |
| Timeline |
| Tesla Inc |
| Identiv |
Tesla and Identiv Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tesla and Identiv
The main advantage of trading using opposite Tesla and Identiv positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tesla 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.| Tesla vs. ULTRA CLEAN HLDGS | Tesla vs. ALERION CLEANPOWER | Tesla vs. BOS BETTER ONLINE | Tesla vs. Gruppo Mutuionline SpA |
| Identiv vs. MIRAMAR HOTEL INV | Identiv vs. DALATA HOTEL | Identiv vs. Hyatt Hotels | Identiv vs. MHP Hotel AG |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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