Correlation Between Superior Plus and Eastman Chemical
Can any of the company-specific risk be diversified away by investing in both Superior Plus and Eastman Chemical 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 Superior Plus and Eastman Chemical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Superior Plus Corp and Eastman Chemical, you can compare the effects of market volatilities on Superior Plus and Eastman Chemical 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 Superior Plus with a short position of Eastman Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Superior Plus and Eastman Chemical.
Diversification Opportunities for Superior Plus and Eastman Chemical
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between Superior and Eastman is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Superior Plus Corp and Eastman Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eastman Chemical and Superior Plus 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 Superior Plus Corp are associated (or correlated) with Eastman Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eastman Chemical has no effect on the direction of Superior Plus i.e., Superior Plus and Eastman Chemical go up and down completely randomly.
Pair Corralation between Superior Plus and Eastman Chemical
Assuming the 90 days horizon Superior Plus Corp is expected to under-perform the Eastman Chemical. In addition to that, Superior Plus is 2.67 times more volatile than Eastman Chemical. It trades about -0.01 of its total potential returns per unit of risk. Eastman Chemical is currently generating about 0.03 per unit of volatility. If you would invest 9,768 in Eastman Chemical on August 29, 2024 and sell it today you would earn a total of 84.00 from holding Eastman Chemical or generate 0.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Superior Plus Corp vs. Eastman Chemical
Performance |
| Timeline |
| Superior Plus Corp |
| Eastman Chemical |
Superior Plus and Eastman Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Superior Plus and Eastman Chemical
The main advantage of trading using opposite Superior Plus and Eastman Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Superior Plus position performs unexpectedly, Eastman Chemical 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 Eastman Chemical will offset losses from the drop in Eastman Chemical's long position.| Superior Plus vs. Canon Marketing Japan | Superior Plus vs. CANON MARKETING JP | Superior Plus vs. KRISPY KREME DL 01 | Superior Plus vs. SIDETRADE EO 1 |
| Eastman Chemical vs. Superior Plus Corp | Eastman Chemical vs. NMI Holdings | Eastman Chemical vs. Origin Agritech | Eastman Chemical vs. SIVERS SEMICONDUCTORS AB |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
Other Complementary Tools
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities |