Correlation Between Chevron Corp and PHILIP
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By analyzing existing cross correlation between Chevron Corp and PHILIP MORRIS INTERNATIONAL, you can compare the effects of market volatilities on Chevron Corp and PHILIP 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 Chevron Corp with a short position of PHILIP. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chevron Corp and PHILIP.
Diversification Opportunities for Chevron Corp and PHILIP
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Chevron and PHILIP is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Chevron Corp and PHILIP MORRIS INTERNATIONAL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PHILIP MORRIS INTERN and Chevron Corp 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 Chevron Corp are associated (or correlated) with PHILIP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PHILIP MORRIS INTERN has no effect on the direction of Chevron Corp i.e., Chevron Corp and PHILIP go up and down completely randomly.
Pair Corralation between Chevron Corp and PHILIP
If you would invest 14,689 in Chevron Corp on August 28, 2024 and sell it today you would earn a total of 1,347 from holding Chevron Corp or generate 9.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 0.28% |
| Values | Daily Returns |
Chevron Corp vs. PHILIP MORRIS INTERNATIONAL
Performance |
| Timeline |
| Chevron Corp |
| PHILIP MORRIS INTERN |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Chevron Corp and PHILIP Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chevron Corp and PHILIP
The main advantage of trading using opposite Chevron Corp and PHILIP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chevron Corp position performs unexpectedly, PHILIP 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 PHILIP will offset losses from the drop in PHILIP's long position.The idea behind Chevron Corp and PHILIP MORRIS INTERNATIONAL pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| PHILIP vs. Victorias Secret Co | PHILIP vs. Citi Trends | PHILIP vs. Steven Madden | PHILIP vs. Lululemon Athletica |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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