Correlation Between Mativ Holdings and V2X

Can any of the company-specific risk be diversified away by investing in both Mativ Holdings and V2X 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 Mativ Holdings and V2X into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Mativ Holdings and V2X Inc, you can compare the effects of market volatilities on Mativ Holdings and V2X 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 Mativ Holdings with a short position of V2X. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mativ Holdings and V2X.

Diversification Opportunities for Mativ Holdings and V2X

-0.08

Correlation Coefficient

Mativ Holdings  V2X

Good diversification

The 3 months correlation between Mativ and V2X is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Mativ Holdings and V2X Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on V2X Inc and Mativ Holdings 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 Mativ Holdings are associated (or correlated) with V2X. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of V2X Inc has no effect on the direction of Mativ Holdings i.e., Mativ Holdings and V2X go up and down completely randomly.

Pair Corralation between Mativ Holdings and V2X

Given the investment horizon of 90 days Mativ Holdings is expected to generate 1.78 times more return on investment than V2X. However, Mativ Holdings is 1.78 times more volatile than V2X Inc. It trades about 0.13 of its potential returns per unit of risk. V2X Inc is currently generating about -0.02 per unit of risk. If you would invest  515.00  in Mativ Holdings on May 3, 2025 and sell it today you would earn a total of  147.00  from holding Mativ Holdings or generate 28.54% return on investment over 90 days.

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

Mativ Holdings  vs.  V2X Inc

Mativ Holdings

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Mativ Holdings are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unsteady basic indicators, Mativ Holdings showed solid returns over the last few months and may actually be approaching a breakup point.

V2X Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days V2X Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, V2X is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Mativ Holdings and V2X

The main advantage of trading using opposite Mativ Holdings and V2X positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mativ Holdings position performs unexpectedly, V2X 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 V2X will offset losses from the drop in V2X's long position.

The idea behind Mativ Holdings and V2X 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.

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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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.