Correlation Between SEALED AIR and FlatexDEGIRO

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

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

Diversification Opportunities for SEALED AIR and FlatexDEGIRO

-0.8

Correlation Coefficient

SEALED AIR  FlatexDEGIRO

Pay attention - limited upside

The 3 months correlation between SEALED and FlatexDEGIRO is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding SEALED AIR and flatexDEGIRO AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on flatexDEGIRO AG and SEALED AIR 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 SEALED AIR are associated (or correlated) with FlatexDEGIRO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of flatexDEGIRO AG has no effect on the direction of SEALED AIR i.e., SEALED AIR and FlatexDEGIRO go up and down completely randomly.

Pair Corralation between SEALED AIR and FlatexDEGIRO

Assuming the 90 days trading horizon SEALED AIR is expected to under-perform the FlatexDEGIRO. But the stock apears to be less risky and, when comparing its historical volatility, SEALED AIR is 1.41 times less risky than FlatexDEGIRO. The stock trades about -0.16 of its potential returns per unit of risk. The flatexDEGIRO AG is currently generating about 0.29 of returns per unit of risk over similar time horizon. If you would invest  1,488  in flatexDEGIRO AG on December 26, 2024 and sell it today you would earn a total of  752.00  from holding flatexDEGIRO AG or generate 50.54% return on investment over 90 days.

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

SEALED AIR   vs.  flatexDEGIRO AG

SEALED AIR

Risk-Adjusted Performance

Very Weak

Over the last 90 days SEALED AIR has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

flatexDEGIRO AG

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in flatexDEGIRO AG are ranked lower than 23 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak forward-looking signals, FlatexDEGIRO unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with SEALED AIR and FlatexDEGIRO

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

The idea behind SEALED AIR and flatexDEGIRO AG 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.