Correlation Between Eastman Chemical and Eastinco Mining
Can any of the company-specific risk be diversified away by investing in both Eastman Chemical and Eastinco Mining 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 Eastman Chemical and Eastinco Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eastman Chemical Co and Eastinco Mining Exploration, you can compare the effects of market volatilities on Eastman Chemical and Eastinco Mining 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 Eastman Chemical with a short position of Eastinco Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eastman Chemical and Eastinco Mining.
Diversification Opportunities for Eastman Chemical and Eastinco Mining
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Eastman and Eastinco is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Eastman Chemical Co and Eastinco Mining Exploration in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eastinco Mining Expl and Eastman Chemical 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 Eastman Chemical Co are associated (or correlated) with Eastinco Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eastinco Mining Expl has no effect on the direction of Eastman Chemical i.e., Eastman Chemical and Eastinco Mining go up and down completely randomly.
Pair Corralation between Eastman Chemical and Eastinco Mining
Assuming the 90 days trading horizon Eastman Chemical Co is expected to under-perform the Eastinco Mining. But the stock apears to be less risky and, when comparing its historical volatility, Eastman Chemical Co is 2.67 times less risky than Eastinco Mining. The stock trades about -0.46 of its potential returns per unit of risk. The Eastinco Mining Exploration is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 4,950 in Eastinco Mining Exploration on October 16, 2024 and sell it today you would earn a total of 500.00 from holding Eastinco Mining Exploration or generate 10.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 89.47% |
| Values | Daily Returns |
Eastman Chemical Co vs. Eastinco Mining Exploration
Performance |
| Timeline |
| Eastman Chemical |
| Eastinco Mining Expl |
Eastman Chemical and Eastinco Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eastman Chemical and Eastinco Mining
The main advantage of trading using opposite Eastman Chemical and Eastinco Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eastman Chemical position performs unexpectedly, Eastinco Mining 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 Eastinco Mining will offset losses from the drop in Eastinco Mining's long position.| Eastman Chemical vs. Hochschild Mining plc | Eastman Chemical vs. Atalaya Mining | Eastman Chemical vs. Europa Metals | Eastman Chemical vs. Panther Metals PLC |
| Eastinco Mining vs. Thor Mining PLC | Eastinco Mining vs. Eco Animal Health | Eastinco Mining vs. Spire Healthcare Group | Eastinco Mining vs. Scandinavian Tobacco Group |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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