Correlation Between STATE and Avient Corp
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By analyzing existing cross correlation between STATE STREET P and Avient Corp, you can compare the effects of market volatilities on STATE and Avient Corp 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 STATE with a short position of Avient Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of STATE and Avient Corp.
Diversification Opportunities for STATE and Avient Corp
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between STATE and Avient is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding STATE STREET P and Avient Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Avient Corp and STATE 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 STATE STREET P are associated (or correlated) with Avient Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Avient Corp has no effect on the direction of STATE i.e., STATE and Avient Corp go up and down completely randomly.
Pair Corralation between STATE and Avient Corp
Assuming the 90 days trading horizon STATE is expected to generate 11.5 times less return on investment than Avient Corp. But when comparing it to its historical volatility, STATE STREET P is 2.71 times less risky than Avient Corp. It trades about 0.01 of its potential returns per unit of risk. Avient Corp is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 3,982 in Avient Corp on September 12, 2024 and sell it today you would earn a total of 950.00 from holding Avient Corp or generate 23.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 98.86% |
| Values | Daily Returns |
STATE STREET P vs. Avient Corp
Performance |
| Timeline |
| STATE STREET P |
| Avient Corp |
STATE and Avient Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with STATE and Avient Corp
The main advantage of trading using opposite STATE and Avient Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if STATE position performs unexpectedly, Avient Corp 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 Avient Corp will offset losses from the drop in Avient Corp's long position.| STATE vs. Regeneron Pharmaceuticals | STATE vs. Western Acquisition Ventures | STATE vs. Highway Holdings Limited | STATE vs. Supercom |
| Avient Corp vs. Griffon | Avient Corp vs. Merck Company | Avient Corp vs. Brinker International | Avient Corp vs. Alcoa 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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