Correlation Between Eastman Chemical and Odyssean Investment
Can any of the company-specific risk be diversified away by investing in both Eastman Chemical and Odyssean Investment 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 Odyssean Investment 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 Odyssean Investment Trust, you can compare the effects of market volatilities on Eastman Chemical and Odyssean Investment 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 Odyssean Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eastman Chemical and Odyssean Investment.
Diversification Opportunities for Eastman Chemical and Odyssean Investment
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Eastman and Odyssean is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Eastman Chemical Co and Odyssean Investment Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Odyssean Investment Trust 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 Odyssean Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Odyssean Investment Trust has no effect on the direction of Eastman Chemical i.e., Eastman Chemical and Odyssean Investment go up and down completely randomly.
Pair Corralation between Eastman Chemical and Odyssean Investment
Assuming the 90 days trading horizon Eastman Chemical Co is expected to under-perform the Odyssean Investment. But the stock apears to be less risky and, when comparing its historical volatility, Eastman Chemical Co is 1.03 times less risky than Odyssean Investment. The stock trades about -0.06 of its potential returns per unit of risk. The Odyssean Investment Trust is currently generating about -0.05 of returns per unit of risk over similar time horizon. If you would invest 15,650 in Odyssean Investment Trust on September 13, 2024 and sell it today you would lose (250.00) from holding Odyssean Investment Trust or give up 1.6% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Eastman Chemical Co vs. Odyssean Investment Trust
Performance |
| Timeline |
| Eastman Chemical |
| Odyssean Investment Trust |
Eastman Chemical and Odyssean Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eastman Chemical and Odyssean Investment
The main advantage of trading using opposite Eastman Chemical and Odyssean Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eastman Chemical position performs unexpectedly, Odyssean Investment 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 Odyssean Investment will offset losses from the drop in Odyssean Investment's long position.| Eastman Chemical vs. Axfood AB | Eastman Chemical vs. Taiwan Semiconductor Manufacturing | Eastman Chemical vs. Roper Technologies | Eastman Chemical vs. Elmos Semiconductor SE |
| Odyssean Investment vs. Catalyst Media Group | Odyssean Investment vs. CATLIN GROUP | Odyssean Investment vs. Tamburi Investment Partners | Odyssean Investment vs. Magnora ASA |
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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