Correlation Between Global X and Eastman Chemical
Can any of the company-specific risk be diversified away by investing in both Global X 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 Global X and Eastman Chemical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global X Funds and Eastman Chemical, you can compare the effects of market volatilities on Global X 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 Global X with a short position of Eastman Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global X and Eastman Chemical.
Diversification Opportunities for Global X and Eastman Chemical
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Global and Eastman is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Global X Funds and Eastman Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eastman Chemical and Global X 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 Global X Funds 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 Global X i.e., Global X and Eastman Chemical go up and down completely randomly.
Pair Corralation between Global X and Eastman Chemical
If you would invest 27,540 in Eastman Chemical on November 2, 2024 and sell it today you would earn a total of 0.00 from holding Eastman Chemical or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Global X Funds vs. Eastman Chemical
Performance |
| Timeline |
| Global X Funds |
| Eastman Chemical |
Global X and Eastman Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global X and Eastman Chemical
The main advantage of trading using opposite Global X and Eastman Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global X 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.| Global X vs. Lloyds Banking Group | Global X vs. Raytheon Technologies | Global X vs. Synchrony Financial | Global X vs. Align Technology |
| Eastman Chemical vs. Check Point Software | Eastman Chemical vs. Cardinal Health, | Eastman Chemical vs. UnitedHealth Group Incorporated | Eastman Chemical vs. Cognizant Technology Solutions |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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