Correlation Between Pactiv Evergreen and Millennium Group

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

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

Diversification Opportunities for Pactiv Evergreen and Millennium Group

-0.05

Correlation Coefficient

Pactiv Evergreen  Millennium Group

Good diversification

The 3 months correlation between Pactiv and Millennium is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Pactiv Evergreen and Millennium Group International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Millennium Group Int and Pactiv Evergreen 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 Pactiv Evergreen are associated (or correlated) with Millennium Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Millennium Group Int has no effect on the direction of Pactiv Evergreen i.e., Pactiv Evergreen and Millennium Group go up and down completely randomly.

Pair Corralation between Pactiv Evergreen and Millennium Group

Given the investment horizon of 90 days Pactiv Evergreen is expected to generate 2.77 times less return on investment than Millennium Group. But when comparing it to its historical volatility, Pactiv Evergreen is 5.17 times less risky than Millennium Group. It trades about 0.31 of its potential returns per unit of risk. Millennium Group International is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest  154.00  in Millennium Group International on September 30, 2024 and sell it today you would earn a total of  87.00  from holding Millennium Group International or generate 56.49% return on investment over 90 days.

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

Pactiv Evergreen  vs.  Millennium Group International

Pactiv Evergreen

Risk-Adjusted Performance

18 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Pactiv Evergreen are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak basic indicators, Pactiv Evergreen exhibited solid returns over the last few months and may actually be approaching a breakup point.

Millennium Group Int

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Millennium Group International are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak forward indicators, Millennium Group demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Pactiv Evergreen and Millennium Group

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

The idea behind Pactiv Evergreen and Millennium Group International 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.