Correlation Between Chevron Corp and Windtree Therapeutics
Can any of the company-specific risk be diversified away by investing in both Chevron Corp and Windtree Therapeutics 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 Chevron Corp and Windtree Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chevron Corp and Windtree Therapeutics, you can compare the effects of market volatilities on Chevron Corp and Windtree Therapeutics 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 Windtree Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chevron Corp and Windtree Therapeutics.
Diversification Opportunities for Chevron Corp and Windtree Therapeutics
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Chevron and Windtree is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Chevron Corp and Windtree Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Windtree Therapeutics 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 Windtree Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Windtree Therapeutics has no effect on the direction of Chevron Corp i.e., Chevron Corp and Windtree Therapeutics go up and down completely randomly.
Pair Corralation between Chevron Corp and Windtree Therapeutics
Considering the 90-day investment horizon Chevron Corp is expected to generate 0.11 times more return on investment than Windtree Therapeutics. However, Chevron Corp is 8.82 times less risky than Windtree Therapeutics. It trades about 0.01 of its potential returns per unit of risk. Windtree Therapeutics is currently generating about -0.04 per unit of risk. If you would invest 15,497 in Chevron Corp on August 30, 2024 and sell it today you would earn a total of 714.00 from holding Chevron Corp or generate 4.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chevron Corp vs. Windtree Therapeutics
Performance |
| Timeline |
| Chevron Corp |
| Windtree Therapeutics |
Chevron Corp and Windtree Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chevron Corp and Windtree Therapeutics
The main advantage of trading using opposite Chevron Corp and Windtree Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chevron Corp position performs unexpectedly, Windtree Therapeutics 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 Windtree Therapeutics will offset losses from the drop in Windtree Therapeutics' long position.| Chevron Corp vs. BP PLC ADR | Chevron Corp vs. Shell PLC ADR | Chevron Corp vs. Petroleo Brasileiro Petrobras | Chevron Corp vs. Suncor Energy |
| Windtree Therapeutics vs. Neurobo Pharmaceuticals | Windtree Therapeutics vs. Palisade Bio | Windtree Therapeutics vs. Lixte Biotechnology Holdings | Windtree Therapeutics vs. Avenue Therapeutics |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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