Correlation Between Axalta Coating and WHITE
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By analyzing existing cross correlation between Axalta Coating Systems and WHITE CAP BUYER, you can compare the effects of market volatilities on Axalta Coating and WHITE 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 Axalta Coating with a short position of WHITE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Axalta Coating and WHITE.
Diversification Opportunities for Axalta Coating and WHITE
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Axalta and WHITE is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Axalta Coating Systems and WHITE CAP BUYER in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WHITE CAP BUYER and Axalta Coating 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 Axalta Coating Systems are associated (or correlated) with WHITE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WHITE CAP BUYER has no effect on the direction of Axalta Coating i.e., Axalta Coating and WHITE go up and down completely randomly.
Pair Corralation between Axalta Coating and WHITE
Given the investment horizon of 90 days Axalta Coating is expected to generate 41.2 times less return on investment than WHITE. But when comparing it to its historical volatility, Axalta Coating Systems is 40.75 times less risky than WHITE. It trades about 0.06 of its potential returns per unit of risk. WHITE CAP BUYER is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 8,782 in WHITE CAP BUYER on September 12, 2024 and sell it today you would earn a total of 1,294 from holding WHITE CAP BUYER or generate 14.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 88.89% |
| Values | Daily Returns |
Axalta Coating Systems vs. WHITE CAP BUYER
Performance |
| Timeline |
| Axalta Coating Systems |
| WHITE CAP BUYER |
Axalta Coating and WHITE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Axalta Coating and WHITE
The main advantage of trading using opposite Axalta Coating and WHITE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Axalta Coating position performs unexpectedly, WHITE 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 WHITE will offset losses from the drop in WHITE's long position.| Axalta Coating vs. Avient Corp | Axalta Coating vs. H B Fuller | Axalta Coating vs. Quaker Chemical | Axalta Coating vs. Cabot |
| WHITE vs. Western Copper and | WHITE vs. Kandi Technologies Group | WHITE vs. Highway Holdings Limited | WHITE vs. Grupo Televisa SAB |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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