Correlation Between AS Latvijas and Identiv
Can any of the company-specific risk be diversified away by investing in both AS Latvijas 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 AS Latvijas and Identiv into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AS Latvijas balzams and Identiv, you can compare the effects of market volatilities on AS Latvijas 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 AS Latvijas with a short position of Identiv. Check out your portfolio center. Please also check ongoing floating volatility patterns of AS Latvijas and Identiv.
Diversification Opportunities for AS Latvijas and Identiv
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between UM9 and Identiv is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding AS Latvijas balzams and Identiv in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Identiv and AS Latvijas 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 AS Latvijas balzams 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 AS Latvijas i.e., AS Latvijas and Identiv go up and down completely randomly.
Pair Corralation between AS Latvijas and Identiv
Assuming the 90 days trading horizon AS Latvijas balzams is expected to generate 0.05 times more return on investment than Identiv. However, AS Latvijas balzams is 21.09 times less risky than Identiv. It trades about 0.01 of its potential returns per unit of risk. Identiv is currently generating about -0.05 per unit of risk. If you would invest 910.00 in AS Latvijas balzams on September 4, 2024 and sell it today you would earn a total of 5.00 from holding AS Latvijas balzams or generate 0.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
AS Latvijas balzams vs. Identiv
Performance |
| Timeline |
| AS Latvijas balzams |
| Identiv |
AS Latvijas and Identiv Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AS Latvijas and Identiv
The main advantage of trading using opposite AS Latvijas and Identiv positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AS Latvijas 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.| AS Latvijas vs. VIRGIN WINES UK | AS Latvijas vs. Superior Plus Corp | AS Latvijas vs. NMI Holdings | AS Latvijas vs. Origin Agritech |
| Identiv vs. SEALED AIR | Identiv vs. WIZZ AIR HLDGUNSPADR4 | Identiv vs. Alaska Air Group | Identiv vs. FORWARD AIR P |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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