Correlation Between Chemours and Haydale Graphene
Can any of the company-specific risk be diversified away by investing in both Chemours and Haydale Graphene 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 Haydale Graphene into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chemours Co and Haydale Graphene Industries, you can compare the effects of market volatilities on Chemours and Haydale Graphene 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 Haydale Graphene. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chemours and Haydale Graphene.
Diversification Opportunities for Chemours and Haydale Graphene
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Chemours and Haydale is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Chemours Co and Haydale Graphene Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Haydale Graphene Ind 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 Haydale Graphene. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Haydale Graphene Ind has no effect on the direction of Chemours i.e., Chemours and Haydale Graphene go up and down completely randomly.
Pair Corralation between Chemours and Haydale Graphene
Allowing for the 90-day total investment horizon Chemours is expected to generate 219.02 times less return on investment than Haydale Graphene. But when comparing it to its historical volatility, Chemours Co is 5.4 times less risky than Haydale Graphene. It trades about 0.0 of its potential returns per unit of risk. Haydale Graphene Industries is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 2.50 in Haydale Graphene Industries on September 12, 2024 and sell it today you would lose (2.30) from holding Haydale Graphene Industries or give up 92.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Chemours Co vs. Haydale Graphene Industries
Performance |
| Timeline |
| Chemours |
| Haydale Graphene Ind |
Chemours and Haydale Graphene Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chemours and Haydale Graphene
The main advantage of trading using opposite Chemours and Haydale Graphene positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chemours position performs unexpectedly, Haydale Graphene 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 Haydale Graphene will offset losses from the drop in Haydale Graphene's long position.| Chemours vs. Griffon | Chemours vs. Merck Company | Chemours vs. Brinker International | Chemours vs. Alcoa Corp |
| Haydale Graphene vs. Chemours Co | Haydale Graphene vs. International Flavors Fragrances | Haydale Graphene vs. Air Products and | Haydale Graphene 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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