Correlation Between CF Industries and CLOROX
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By analyzing existing cross correlation between CF Industries Holdings and CLOROX 31 percent, you can compare the effects of market volatilities on CF Industries and CLOROX 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 CF Industries with a short position of CLOROX. Check out your portfolio center. Please also check ongoing floating volatility patterns of CF Industries and CLOROX.
Diversification Opportunities for CF Industries and CLOROX
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between CF Industries and CLOROX is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding CF Industries Holdings and CLOROX 31 percent in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CLOROX 31 percent and CF Industries 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 CF Industries Holdings are associated (or correlated) with CLOROX. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CLOROX 31 percent has no effect on the direction of CF Industries i.e., CF Industries and CLOROX go up and down completely randomly.
Pair Corralation between CF Industries and CLOROX
Allowing for the 90-day total investment horizon CF Industries Holdings is expected to generate 2.42 times more return on investment than CLOROX. However, CF Industries is 2.42 times more volatile than CLOROX 31 percent. It trades about 0.21 of its potential returns per unit of risk. CLOROX 31 percent is currently generating about -0.29 per unit of risk. If you would invest 8,143 in CF Industries Holdings on August 28, 2024 and sell it today you would earn a total of 596.00 from holding CF Industries Holdings or generate 7.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 90.48% |
| Values | Daily Returns |
CF Industries Holdings vs. CLOROX 31 percent
Performance |
| Timeline |
| CF Industries Holdings |
| CLOROX 31 percent |
CF Industries and CLOROX Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CF Industries and CLOROX
The main advantage of trading using opposite CF Industries and CLOROX positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CF Industries position performs unexpectedly, CLOROX 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 CLOROX will offset losses from the drop in CLOROX's long position.| CF Industries vs. Nutrien | CF Industries vs. Intrepid Potash | CF Industries vs. Corteva | CF Industries vs. ICL Israel Chemicals |
| CLOROX vs. Omni Health | CLOROX vs. CF Industries Holdings | CLOROX vs. Avient Corp | CLOROX vs. Franklin Credit Management |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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