Correlation Between Chrysalis Investments and Henkel AG
Can any of the company-specific risk be diversified away by investing in both Chrysalis Investments and Henkel AG 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 Chrysalis Investments and Henkel AG into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chrysalis Investments and Henkel AG Co, you can compare the effects of market volatilities on Chrysalis Investments and Henkel AG 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 Chrysalis Investments with a short position of Henkel AG. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chrysalis Investments and Henkel AG.
Diversification Opportunities for Chrysalis Investments and Henkel AG
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Chrysalis and Henkel is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Chrysalis Investments and Henkel AG Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Henkel AG and Chrysalis Investments 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 Chrysalis Investments are associated (or correlated) with Henkel AG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Henkel AG has no effect on the direction of Chrysalis Investments i.e., Chrysalis Investments and Henkel AG go up and down completely randomly.
Pair Corralation between Chrysalis Investments and Henkel AG
Assuming the 90 days trading horizon Chrysalis Investments is expected to under-perform the Henkel AG. In addition to that, Chrysalis Investments is 2.18 times more volatile than Henkel AG Co. It trades about -0.06 of its total potential returns per unit of risk. Henkel AG Co is currently generating about -0.01 per unit of volatility. If you would invest 7,468 in Henkel AG Co on November 3, 2024 and sell it today you would lose (23.00) from holding Henkel AG Co or give up 0.31% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chrysalis Investments vs. Henkel AG Co
Performance |
| Timeline |
| Chrysalis Investments |
| Henkel AG |
Chrysalis Investments and Henkel AG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chrysalis Investments and Henkel AG
The main advantage of trading using opposite Chrysalis Investments and Henkel AG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chrysalis Investments position performs unexpectedly, Henkel AG 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 Henkel AG will offset losses from the drop in Henkel AG's long position.| Chrysalis Investments vs. Silvercorp Metals | Chrysalis Investments vs. Empire Metals Limited | Chrysalis Investments vs. Europa Metals | Chrysalis Investments vs. AMG Advanced Metallurgical |
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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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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