Correlation Between COPLAND ROAD and Eastman Chemical
Can any of the company-specific risk be diversified away by investing in both COPLAND ROAD 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 COPLAND ROAD and Eastman Chemical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between COPLAND ROAD CAPITAL and Eastman Chemical, you can compare the effects of market volatilities on COPLAND ROAD 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 COPLAND ROAD with a short position of Eastman Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of COPLAND ROAD and Eastman Chemical.
Diversification Opportunities for COPLAND ROAD and Eastman Chemical
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between COPLAND and Eastman is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding COPLAND ROAD CAPITAL and Eastman Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eastman Chemical and COPLAND ROAD 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 COPLAND ROAD CAPITAL 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 COPLAND ROAD i.e., COPLAND ROAD and Eastman Chemical go up and down completely randomly.
Pair Corralation between COPLAND ROAD and Eastman Chemical
Assuming the 90 days horizon COPLAND ROAD CAPITAL is expected to generate 1.92 times more return on investment than Eastman Chemical. However, COPLAND ROAD is 1.92 times more volatile than Eastman Chemical. It trades about 0.11 of its potential returns per unit of risk. Eastman Chemical is currently generating about 0.13 per unit of risk. If you would invest 5,090 in COPLAND ROAD CAPITAL on November 28, 2024 and sell it today you would earn a total of 360.00 from holding COPLAND ROAD CAPITAL or generate 7.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
COPLAND ROAD CAPITAL vs. Eastman Chemical
Performance |
| Timeline |
| COPLAND ROAD CAPITAL |
| Eastman Chemical |
COPLAND ROAD and Eastman Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with COPLAND ROAD and Eastman Chemical
The main advantage of trading using opposite COPLAND ROAD and Eastman Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if COPLAND ROAD 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.| COPLAND ROAD vs. DEVRY EDUCATION GRP | COPLAND ROAD vs. Xinhua Winshare Publishing | COPLAND ROAD vs. EMBARK EDUCATION LTD | COPLAND ROAD vs. CLOVER HEALTH INV |
| Eastman Chemical vs. CALTAGIRONE EDITORE | Eastman Chemical vs. USWE SPORTS AB | Eastman Chemical vs. KOBE STEEL LTD | Eastman Chemical vs. Sch Environnement SA |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
Other Complementary Tools
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Stocks Directory Find actively traded stocks across global markets |