Correlation Between Omni Health and Sealed Air

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Can any of the company-specific risk be diversified away by investing in both Omni Health and Sealed Air 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 Omni Health and Sealed Air into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Omni Health and Sealed Air, you can compare the effects of market volatilities on Omni Health and Sealed Air 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 Omni Health with a short position of Sealed Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of Omni Health and Sealed Air.

Diversification Opportunities for Omni Health and Sealed Air

0.0
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Omni and Sealed is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Omni Health and Sealed Air in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sealed Air and Omni Health 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 Omni Health are associated (or correlated) with Sealed Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sealed Air has no effect on the direction of Omni Health i.e., Omni Health and Sealed Air go up and down completely randomly.

Pair Corralation between Omni Health and Sealed Air

If you would invest  3,641  in Sealed Air on September 6, 2024 and sell it today you would earn a total of  2.00  from holding Sealed Air or generate 0.05% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy95.45%
ValuesDaily Returns

Omni Health  vs.  Sealed Air

 Performance 
       Timeline  
Omni Health 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Omni Health has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound technical indicators, Omni Health is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.
Sealed Air 

Risk-Adjusted Performance

9 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Sealed Air are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak technical and fundamental indicators, Sealed Air may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Omni Health and Sealed Air Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Omni Health and Sealed Air

The main advantage of trading using opposite Omni Health and Sealed Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Omni Health position performs unexpectedly, Sealed Air 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 Sealed Air will offset losses from the drop in Sealed Air's long position.
The idea behind Omni Health and Sealed Air 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.

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