Correlation Between Eastman Chemical and STAG Industrial,
Can any of the company-specific risk be diversified away by investing in both Eastman Chemical and STAG Industrial, 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 Eastman Chemical and STAG Industrial, into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eastman Chemical and STAG Industrial,, you can compare the effects of market volatilities on Eastman Chemical and STAG Industrial, 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 Eastman Chemical with a short position of STAG Industrial,. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eastman Chemical and STAG Industrial,.
Diversification Opportunities for Eastman Chemical and STAG Industrial,
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Eastman and STAG is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Eastman Chemical and STAG Industrial, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on STAG Industrial, and Eastman Chemical 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 Eastman Chemical are associated (or correlated) with STAG Industrial,. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of STAG Industrial, has no effect on the direction of Eastman Chemical i.e., Eastman Chemical and STAG Industrial, go up and down completely randomly.
Pair Corralation between Eastman Chemical and STAG Industrial,
Assuming the 90 days trading horizon Eastman Chemical is expected to generate 0.61 times more return on investment than STAG Industrial,. However, Eastman Chemical is 1.65 times less risky than STAG Industrial,. It trades about 0.05 of its potential returns per unit of risk. STAG Industrial, is currently generating about 0.03 per unit of risk. If you would invest 22,021 in Eastman Chemical on October 11, 2024 and sell it today you would earn a total of 5,519 from holding Eastman Chemical or generate 25.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Eastman Chemical vs. STAG Industrial,
Performance |
| Timeline |
| Eastman Chemical |
| STAG Industrial, |
Eastman Chemical and STAG Industrial, Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eastman Chemical and STAG Industrial,
The main advantage of trading using opposite Eastman Chemical and STAG Industrial, positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eastman Chemical position performs unexpectedly, STAG Industrial, 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 STAG Industrial, will offset losses from the drop in STAG Industrial,'s long position.| Eastman Chemical vs. JB Hunt Transport | Eastman Chemical vs. Micron Technology | Eastman Chemical vs. Cognizant Technology Solutions | Eastman Chemical vs. DENTSPLY SIRONA |
| STAG Industrial, vs. Taiwan Semiconductor Manufacturing | STAG Industrial, vs. Apple Inc | STAG Industrial, vs. Alibaba Group Holding | STAG Industrial, vs. Banco Santander Chile |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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