Correlation Between Carbios SAS and Chemours
Can any of the company-specific risk be diversified away by investing in both Carbios SAS and Chemours 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 Carbios SAS and Chemours into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Carbios SAS and Chemours Co, you can compare the effects of market volatilities on Carbios SAS and Chemours 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 Carbios SAS with a short position of Chemours. Check out your portfolio center. Please also check ongoing floating volatility patterns of Carbios SAS and Chemours.
Diversification Opportunities for Carbios SAS and Chemours
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Carbios and Chemours is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Carbios SAS and Chemours Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chemours and Carbios SAS 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 Carbios SAS are associated (or correlated) with Chemours. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chemours has no effect on the direction of Carbios SAS i.e., Carbios SAS and Chemours go up and down completely randomly.
Pair Corralation between Carbios SAS and Chemours
Assuming the 90 days horizon Carbios SAS is expected to under-perform the Chemours. In addition to that, Carbios SAS is 1.22 times more volatile than Chemours Co. It trades about -0.05 of its total potential returns per unit of risk. Chemours Co is currently generating about -0.01 per unit of volatility. If you would invest 2,861 in Chemours Co on September 16, 2024 and sell it today you would lose (957.00) from holding Chemours Co or give up 33.45% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Carbios SAS vs. Chemours Co
Performance |
| Timeline |
| Carbios SAS |
| Chemours |
Carbios SAS and Chemours Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Carbios SAS and Chemours
The main advantage of trading using opposite Carbios SAS and Chemours positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Carbios SAS position performs unexpectedly, Chemours 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 Chemours will offset losses from the drop in Chemours' long position.| Carbios SAS vs. Chemours Co | Carbios SAS vs. International Flavors Fragrances | Carbios SAS vs. Air Products and | Carbios SAS vs. PPG Industries |
| Chemours vs. Olin Corporation | Chemours vs. Cabot | Chemours vs. Kronos Worldwide | Chemours vs. LyondellBasell Industries NV |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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