Correlation Between Chemours and First Republic
Can any of the company-specific risk be diversified away by investing in both Chemours and First Republic 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 Chemours and First Republic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chemours Co and First Republic Bank, you can compare the effects of market volatilities on Chemours and First Republic 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 Chemours with a short position of First Republic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chemours and First Republic.
Diversification Opportunities for Chemours and First Republic
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Chemours and First is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Chemours Co and First Republic Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Republic Bank and Chemours 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 Chemours Co are associated (or correlated) with First Republic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Republic Bank has no effect on the direction of Chemours i.e., Chemours and First Republic go up and down completely randomly.
Pair Corralation between Chemours and First Republic
If you would invest (100.00) in First Republic Bank on December 9, 2024 and sell it today you would earn a total of 100.00 from holding First Republic Bank or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Chemours Co vs. First Republic Bank
Performance |
| Timeline |
| Chemours |
| First Republic Bank |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
Chemours and First Republic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chemours and First Republic
The main advantage of trading using opposite Chemours and First Republic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chemours position performs unexpectedly, First Republic 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 First Republic will offset losses from the drop in First Republic's long position.| Chemours vs. International Flavors Fragrances | ||
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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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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