Correlation Between Chesapeake Energy and Save Foods
Can any of the company-specific risk be diversified away by investing in both Chesapeake Energy and Save Foods 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 Energy and Save Foods into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chesapeake Energy and Save Foods, you can compare the effects of market volatilities on Chesapeake Energy and Save Foods 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 Energy with a short position of Save Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chesapeake Energy and Save Foods.
Diversification Opportunities for Chesapeake Energy and Save Foods
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Chesapeake and Save is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Chesapeake Energy and Save Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Save Foods and Chesapeake Energy 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 Energy are associated (or correlated) with Save Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Save Foods has no effect on the direction of Chesapeake Energy i.e., Chesapeake Energy and Save Foods go up and down completely randomly.
Pair Corralation between Chesapeake Energy and Save Foods
Assuming the 90 days horizon Chesapeake Energy is expected to under-perform the Save Foods. But the stock apears to be less risky and, when comparing its historical volatility, Chesapeake Energy is 3.41 times less risky than Save Foods. The stock trades about -0.01 of its potential returns per unit of risk. The Save Foods is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 83.00 in Save Foods on September 2, 2024 and sell it today you would lose (24.00) from holding Save Foods or give up 28.92% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 33.7% |
| Values | Daily Returns |
Chesapeake Energy vs. Save Foods
Performance |
| Timeline |
| Chesapeake Energy |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Solid
| Save Foods |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Chesapeake Energy and Save Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chesapeake Energy and Save Foods
The main advantage of trading using opposite Chesapeake Energy and Save Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chesapeake Energy position performs unexpectedly, Save Foods 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 Save Foods will offset losses from the drop in Save Foods' long position.| Chesapeake Energy vs. Sphere Entertainment Co | Chesapeake Energy vs. Morgan Stanley | Chesapeake Energy vs. Nasdaq Inc | Chesapeake Energy vs. Alvarium Tiedemann Holdings |
| Save Foods vs. Origin Agritech | Save Foods vs. Benson Hill, Common | Save Foods vs. Corteva | Save Foods vs. Scotts Miracle Gro |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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