Correlation Between Chesapeake Utilities and KEBNI AB
Can any of the company-specific risk be diversified away by investing in both Chesapeake Utilities and KEBNI AB 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 KEBNI AB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chesapeake Utilities and KEBNI AB SERB, you can compare the effects of market volatilities on Chesapeake Utilities and KEBNI AB 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 KEBNI AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chesapeake Utilities and KEBNI AB.
Diversification Opportunities for Chesapeake Utilities and KEBNI AB
-0.76 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Chesapeake and KEBNI is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Chesapeake Utilities and KEBNI AB SERB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KEBNI AB SERB 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 KEBNI AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KEBNI AB SERB has no effect on the direction of Chesapeake Utilities i.e., Chesapeake Utilities and KEBNI AB go up and down completely randomly.
Pair Corralation between Chesapeake Utilities and KEBNI AB
Assuming the 90 days horizon Chesapeake Utilities is expected to generate 0.47 times more return on investment than KEBNI AB. However, Chesapeake Utilities is 2.14 times less risky than KEBNI AB. It trades about 0.17 of its potential returns per unit of risk. KEBNI AB SERB is currently generating about -0.17 per unit of risk. If you would invest 10,538 in Chesapeake Utilities on September 2, 2024 and sell it today you would earn a total of 1,762 from holding Chesapeake Utilities or generate 16.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chesapeake Utilities vs. KEBNI AB SERB
Performance |
| Timeline |
| Chesapeake Utilities |
| KEBNI AB SERB |
Chesapeake Utilities and KEBNI AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chesapeake Utilities and KEBNI AB
The main advantage of trading using opposite Chesapeake Utilities and KEBNI AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chesapeake Utilities position performs unexpectedly, KEBNI AB 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 KEBNI AB will offset losses from the drop in KEBNI AB's long position.| Chesapeake Utilities vs. CenterPoint Energy | Chesapeake Utilities vs. Snam SpA | Chesapeake Utilities vs. Superior Plus Corp | Chesapeake Utilities vs. NMI Holdings |
| KEBNI AB vs. Virtus Investment Partners | KEBNI AB vs. SALESFORCE INC CDR | KEBNI AB vs. WisdomTree Investments | KEBNI AB vs. New Residential 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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