Correlation Between CDL INVESTMENT and CHEMICAL INDUSTRIES

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Can any of the company-specific risk be diversified away by investing in both CDL INVESTMENT and CHEMICAL INDUSTRIES 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 CDL INVESTMENT and CHEMICAL INDUSTRIES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CDL INVESTMENT and CHEMICAL INDUSTRIES, you can compare the effects of market volatilities on CDL INVESTMENT and CHEMICAL INDUSTRIES 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 CDL INVESTMENT with a short position of CHEMICAL INDUSTRIES. Check out your portfolio center. Please also check ongoing floating volatility patterns of CDL INVESTMENT and CHEMICAL INDUSTRIES.

Diversification Opportunities for CDL INVESTMENT and CHEMICAL INDUSTRIES

CDLCHEMICALDiversified AwayCDLCHEMICALDiversified Away100%
0.0
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between CDL and CHEMICAL is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding CDL INVESTMENT and CHEMICAL INDUSTRIES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CHEMICAL INDUSTRIES and CDL INVESTMENT 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 CDL INVESTMENT are associated (or correlated) with CHEMICAL INDUSTRIES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CHEMICAL INDUSTRIES has no effect on the direction of CDL INVESTMENT i.e., CDL INVESTMENT and CHEMICAL INDUSTRIES go up and down completely randomly.

Pair Corralation between CDL INVESTMENT and CHEMICAL INDUSTRIES

If you would invest  43.00  in CHEMICAL INDUSTRIES on October 30, 2024 and sell it today you would earn a total of  0.00  from holding CHEMICAL INDUSTRIES or generate 0.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

CDL INVESTMENT  vs.  CHEMICAL INDUSTRIES

 Performance 
JavaScript chart by amCharts 3.21.15NovDec2025 -10-505
JavaScript chart by amCharts 3.21.15BXU V1M
       Timeline  
CDL INVESTMENT 

Risk-Adjusted Performance

6 of 100

 
Weak
 
Strong
Very Weak
Compared to the overall equity markets, risk-adjusted returns on investments in CDL INVESTMENT are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile basic indicators, CDL INVESTMENT may actually be approaching a critical reversion point that can send shares even higher in February 2025.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan0.390.40.410.420.430.440.45
CHEMICAL INDUSTRIES 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days CHEMICAL INDUSTRIES has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound primary indicators, CHEMICAL INDUSTRIES is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan0.430.435

CDL INVESTMENT and CHEMICAL INDUSTRIES Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-3.08-2.31-1.54-0.76-0.01280.741.512.273.043.81 0.020.040.060.080.10
JavaScript chart by amCharts 3.21.15BXU V1M
       Returns  

Pair Trading with CDL INVESTMENT and CHEMICAL INDUSTRIES

The main advantage of trading using opposite CDL INVESTMENT and CHEMICAL INDUSTRIES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CDL INVESTMENT position performs unexpectedly, CHEMICAL INDUSTRIES 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 CHEMICAL INDUSTRIES will offset losses from the drop in CHEMICAL INDUSTRIES's long position.
The idea behind CDL INVESTMENT and CHEMICAL INDUSTRIES pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.

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