Correlation Between Chesapeake Utilities and Orange SA
Can any of the company-specific risk be diversified away by investing in both Chesapeake Utilities and Orange SA 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 Orange SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chesapeake Utilities and Orange SA, you can compare the effects of market volatilities on Chesapeake Utilities and Orange SA 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 Orange SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chesapeake Utilities and Orange SA.
Diversification Opportunities for Chesapeake Utilities and Orange SA
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between Chesapeake and Orange is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Chesapeake Utilities and Orange SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Orange SA 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 Orange SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Orange SA has no effect on the direction of Chesapeake Utilities i.e., Chesapeake Utilities and Orange SA go up and down completely randomly.
Pair Corralation between Chesapeake Utilities and Orange SA
Assuming the 90 days horizon Chesapeake Utilities is expected to generate 3.61 times less return on investment than Orange SA. In addition to that, Chesapeake Utilities is 1.33 times more volatile than Orange SA. It trades about 0.11 of its total potential returns per unit of risk. Orange SA is currently generating about 0.53 per unit of volatility. If you would invest 1,032 in Orange SA on November 28, 2024 and sell it today you would earn a total of 103.00 from holding Orange SA or generate 9.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chesapeake Utilities vs. Orange SA
Performance |
| Timeline |
| Chesapeake Utilities |
| Orange SA |
Chesapeake Utilities and Orange SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chesapeake Utilities and Orange SA
The main advantage of trading using opposite Chesapeake Utilities and Orange SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chesapeake Utilities position performs unexpectedly, Orange SA 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 Orange SA will offset losses from the drop in Orange SA's long position.| Chesapeake Utilities vs. FAST RETAIL ADR | Chesapeake Utilities vs. Cognizant Technology Solutions | Chesapeake Utilities vs. Firan Technology Group | Chesapeake Utilities vs. Algonquin Power Utilities |
| Orange SA vs. AGRICULTBK HADR25 YC | Orange SA vs. Sumitomo Mitsui Construction | Orange SA vs. Alaska Air Group | Orange SA vs. RYANAIR HLDGS ADR |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
Other Complementary Tools
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules |