Correlation Between Chemours and Fuchs Petrolub
Can any of the company-specific risk be diversified away by investing in both Chemours and Fuchs Petrolub 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 Fuchs Petrolub into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chemours Co and Fuchs Petrolub SE, you can compare the effects of market volatilities on Chemours and Fuchs Petrolub 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 Fuchs Petrolub. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chemours and Fuchs Petrolub.
Diversification Opportunities for Chemours and Fuchs Petrolub
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Chemours and Fuchs is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Chemours Co and Fuchs Petrolub SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fuchs Petrolub SE 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 Fuchs Petrolub. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fuchs Petrolub SE has no effect on the direction of Chemours i.e., Chemours and Fuchs Petrolub go up and down completely randomly.
Pair Corralation between Chemours and Fuchs Petrolub
Allowing for the 90-day total investment horizon Chemours Co is expected to generate 1.7 times more return on investment than Fuchs Petrolub. However, Chemours is 1.7 times more volatile than Fuchs Petrolub SE. It trades about 0.23 of its potential returns per unit of risk. Fuchs Petrolub SE is currently generating about -0.15 per unit of risk. If you would invest 1,905 in Chemours Co on September 13, 2024 and sell it today you would earn a total of 212.00 from holding Chemours Co or generate 11.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chemours Co vs. Fuchs Petrolub SE
Performance |
| Timeline |
| Chemours |
| Fuchs Petrolub SE |
Chemours and Fuchs Petrolub Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chemours and Fuchs Petrolub
The main advantage of trading using opposite Chemours and Fuchs Petrolub positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chemours position performs unexpectedly, Fuchs Petrolub 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 Fuchs Petrolub will offset losses from the drop in Fuchs Petrolub's long position.| Chemours vs. International Flavors Fragrances | Chemours vs. Air Products and | Chemours vs. PPG Industries | Chemours vs. Linde plc Ordinary |
| Fuchs Petrolub vs. Chemours Co | Fuchs Petrolub vs. International Flavors Fragrances | Fuchs Petrolub vs. Air Products and | Fuchs Petrolub vs. PPG Industries |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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