Correlation Between Identiv and Quantum

Can any of the company-specific risk be diversified away by investing in both Identiv and Quantum 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 Identiv and Quantum into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Identiv and Quantum, you can compare the effects of market volatilities on Identiv and Quantum 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 Identiv with a short position of Quantum. Check out your portfolio center. Please also check ongoing floating volatility patterns of Identiv and Quantum.

Diversification Opportunities for Identiv and Quantum

0.63

Correlation Coefficient

Identiv  Quantum

Poor diversification

The 3 months correlation between Identiv and Quantum is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Identiv and Quantum in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Quantum and Identiv 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 Identiv are associated (or correlated) with Quantum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Quantum has no effect on the direction of Identiv i.e., Identiv and Quantum go up and down completely randomly.

Pair Corralation between Identiv and Quantum

Given the investment horizon of 90 days Identiv is expected to generate 0.21 times more return on investment than Quantum. However, Identiv is 4.75 times less risky than Quantum. It trades about -0.08 of its potential returns per unit of risk. Quantum is currently generating about -0.12 per unit of risk. If you would invest  373.00  in Identiv on December 29, 2024 and sell it today you would lose (57.00) from holding Identiv or give up 15.28% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Identiv  vs.  Quantum

Identiv

Risk-Adjusted Performance

Very Weak

Over the last 90 days Identiv has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain rather sound which may send shares a bit higher in April 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Quantum

Risk-Adjusted Performance

Very Weak

Over the last 90 days Quantum has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of inconsistent performance in the last few months, the Stock's fundamental indicators remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with Identiv and Quantum

The main advantage of trading using opposite Identiv and Quantum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Identiv position performs unexpectedly, Quantum 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 Quantum will offset losses from the drop in Quantum's long position.

The idea behind Identiv and Quantum pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.