Correlation Between Cricut and Identiv

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

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

Diversification Opportunities for Cricut and Identiv

-0.47

Correlation Coefficient

Cricut  Identiv

Very good diversification

The 3 months correlation between Cricut and Identiv is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Cricut Inc and Identiv in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Identiv and Cricut 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 Cricut Inc 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 Cricut i.e., Cricut and Identiv go up and down completely randomly.

Pair Corralation between Cricut and Identiv

Given the investment horizon of 90 days Cricut is expected to generate 3.57 times less return on investment than Identiv. In addition to that, Cricut is 1.17 times more volatile than Identiv. It trades about 0.02 of its total potential returns per unit of risk. Identiv is currently generating about 0.1 per unit of volatility. If you would invest  335.00  in Identiv on September 9, 2024 and sell it today you would earn a total of  57.00  from holding Identiv or generate 17.01% return on investment over 90 days.

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

Cricut Inc  vs.  Identiv

Cricut Inc

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Cricut Inc are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable fundamental indicators, Cricut is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Identiv

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Identiv are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain basic indicators, Identiv exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Cricut and Identiv

The main advantage of trading using opposite Cricut and Identiv positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cricut 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.

The idea behind Cricut Inc and Identiv 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.