Correlation Between Chemours and Stagwell
Can any of the company-specific risk be diversified away by investing in both Chemours and Stagwell 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 Stagwell into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chemours Co and Stagwell, you can compare the effects of market volatilities on Chemours and Stagwell 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 Stagwell. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chemours and Stagwell.
Diversification Opportunities for Chemours and Stagwell
Poor diversification
The 3 months correlation between Chemours and Stagwell is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Chemours Co and Stagwell in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stagwell 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 Stagwell. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stagwell has no effect on the direction of Chemours i.e., Chemours and Stagwell go up and down completely randomly.
Pair Corralation between Chemours and Stagwell
Allowing for the 90-day total investment horizon Chemours Co is expected to generate 1.24 times more return on investment than Stagwell. However, Chemours is 1.24 times more volatile than Stagwell. It trades about 0.23 of its potential returns per unit of risk. Stagwell is currently generating about -0.08 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 | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Chemours Co vs. Stagwell
Performance |
| Timeline |
| Chemours |
| Stagwell |
Chemours and Stagwell Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chemours and Stagwell
The main advantage of trading using opposite Chemours and Stagwell positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chemours position performs unexpectedly, Stagwell 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 Stagwell will offset losses from the drop in Stagwell's long position.| Chemours vs. International Flavors Fragrances | Chemours vs. Air Products and | Chemours vs. PPG Industries | Chemours vs. Linde plc Ordinary |
| Stagwell vs. Liberty Media | Stagwell vs. Atlanta Braves Holdings, | Stagwell vs. News Corp B | Stagwell vs. News Corp A |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
Other Complementary Tools
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing |