Correlation Between Chesapeake Utilities and Materialise

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Chesapeake Utilities and Materialise 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 Chesapeake Utilities and Materialise into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chesapeake Utilities and Materialise NV, you can compare the effects of market volatilities on Chesapeake Utilities and Materialise 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 Chesapeake Utilities with a short position of Materialise. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chesapeake Utilities and Materialise.

Diversification Opportunities for Chesapeake Utilities and Materialise

0.69
  Correlation Coefficient

Poor diversification

The 3 months correlation between Chesapeake and Materialise is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Chesapeake Utilities and Materialise NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Materialise NV and Chesapeake Utilities 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 Chesapeake Utilities are associated (or correlated) with Materialise. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Materialise NV has no effect on the direction of Chesapeake Utilities i.e., Chesapeake Utilities and Materialise go up and down completely randomly.

Pair Corralation between Chesapeake Utilities and Materialise

Assuming the 90 days horizon Chesapeake Utilities is expected to generate 1.71 times less return on investment than Materialise. But when comparing it to its historical volatility, Chesapeake Utilities is 3.07 times less risky than Materialise. It trades about 0.22 of its potential returns per unit of risk. Materialise NV is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest  700.00  in Materialise NV on October 20, 2024 and sell it today you would earn a total of  50.00  from holding Materialise NV or generate 7.14% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy94.44%
ValuesDaily Returns

Chesapeake Utilities  vs.  Materialise NV

 Performance 
       Timeline  
Chesapeake Utilities 

Risk-Adjusted Performance

7 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Chesapeake Utilities are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Chesapeake Utilities may actually be approaching a critical reversion point that can send shares even higher in February 2025.
Materialise NV 

Risk-Adjusted Performance

14 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Materialise NV are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, Materialise unveiled solid returns over the last few months and may actually be approaching a breakup point.

Chesapeake Utilities and Materialise Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Chesapeake Utilities and Materialise

The main advantage of trading using opposite Chesapeake Utilities and Materialise positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chesapeake Utilities position performs unexpectedly, Materialise 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 Materialise will offset losses from the drop in Materialise's long position.
The idea behind Chesapeake Utilities and Materialise NV pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.

Other Complementary Tools

Premium Stories
Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope
Alpha Finder
Use alpha and beta coefficients to find investment opportunities after accounting for the risk
Portfolio Suggestion
Get suggestions outside of your existing asset allocation including your own model portfolios
Portfolio Volatility
Check portfolio volatility and analyze historical return density to properly model market risk
Headlines Timeline
Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity