Correlation Between Intel and SILGAN

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

Diversification Opportunities for Intel and SILGAN

-0.4
  Correlation Coefficient

Very good diversification

The 3 months correlation between Intel and SILGAN is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Intel and SILGAN HLDGS INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SILGAN HLDGS INC and Intel 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 Intel are associated (or correlated) with SILGAN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SILGAN HLDGS INC has no effect on the direction of Intel i.e., Intel and SILGAN go up and down completely randomly.

Pair Corralation between Intel and SILGAN

Given the investment horizon of 90 days Intel is expected to generate 2.25 times more return on investment than SILGAN. However, Intel is 2.25 times more volatile than SILGAN HLDGS INC. It trades about 0.08 of its potential returns per unit of risk. SILGAN HLDGS INC is currently generating about -0.27 per unit of risk. If you would invest  2,238  in Intel on August 6, 2024 and sell it today you would earn a total of  82.00  from holding Intel or generate 3.66% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy95.24%
ValuesDaily Returns

Intel  vs.  SILGAN HLDGS INC

 Performance 
       Timeline  
Intel 

Risk-Adjusted Performance

6 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Intel are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of rather inconsistent basic indicators, Intel exhibited solid returns over the last few months and may actually be approaching a breakup point.
SILGAN HLDGS INC 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days SILGAN HLDGS INC has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, SILGAN is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Intel and SILGAN Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Intel and SILGAN

The main advantage of trading using opposite Intel and SILGAN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intel position performs unexpectedly, SILGAN 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 SILGAN will offset losses from the drop in SILGAN's long position.
The idea behind Intel and SILGAN HLDGS INC 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.
Check out your portfolio center.
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.

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