Correlation Between Solstice Advanced and SCI Engineered

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

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

Diversification Opportunities for Solstice Advanced and SCI Engineered

0.72

Correlation Coefficient

Solstice Advanced  SCI Engineered

Poor diversification

The 3 months correlation between Solstice and SCI is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Solstice Advanced Materials, and SCI Engineered Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SCI Engineered Materials and Solstice Advanced 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 Solstice Advanced Materials, are associated (or correlated) with SCI Engineered. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SCI Engineered Materials has no effect on the direction of Solstice Advanced i.e., Solstice Advanced and SCI Engineered go up and down completely randomly.

Pair Corralation between Solstice Advanced and SCI Engineered

Given the investment horizon of 90 days Solstice Advanced Materials, is expected to under-perform the SCI Engineered. In addition to that, Solstice Advanced is 1.27 times more volatile than SCI Engineered Materials. It trades about 0.0 of its total potential returns per unit of risk. SCI Engineered Materials is currently generating about 0.13 per unit of volatility. If you would invest  402.00  in SCI Engineered Materials on September 9, 2025 and sell it today you would earn a total of  98.00  from holding SCI Engineered Materials or generate 24.38% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	54.69%
Values	Daily Returns

Solstice Advanced Materials,  vs.  SCI Engineered Materials

Solstice Advanced

Risk-Adjusted Performance

Weakest

Over the last 90 days Solstice Advanced Materials, has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable essential indicators, Solstice Advanced is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

SCI Engineered Materials

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in SCI Engineered Materials are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite somewhat conflicting forward indicators, SCI Engineered sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Solstice Advanced and SCI Engineered

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

The idea behind Solstice Advanced Materials, and SCI Engineered Materials 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.