Correlation Between East Resources and Axalta Coating
Can any of the company-specific risk be diversified away by investing in both East Resources and Axalta Coating 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 East Resources and Axalta Coating into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between East Resources Acquisition and Axalta Coating Systems, you can compare the effects of market volatilities on East Resources and Axalta Coating 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 East Resources with a short position of Axalta Coating. Check out your portfolio center. Please also check ongoing floating volatility patterns of East Resources and Axalta Coating.
Diversification Opportunities for East Resources and Axalta Coating
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between East and Axalta is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding East Resources Acquisition and Axalta Coating Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Axalta Coating Systems and East Resources 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 East Resources Acquisition are associated (or correlated) with Axalta Coating. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Axalta Coating Systems has no effect on the direction of East Resources i.e., East Resources and Axalta Coating go up and down completely randomly.
Pair Corralation between East Resources and Axalta Coating
If you would invest 1,000.00 in East Resources Acquisition on September 14, 2024 and sell it today you would earn a total of 0.00 from holding East Resources Acquisition or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 4.76% |
| Values | Daily Returns |
East Resources Acquisition vs. Axalta Coating Systems
Performance |
| Timeline |
| East Resources Acqui |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Axalta Coating Systems |
East Resources and Axalta Coating Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with East Resources and Axalta Coating
The main advantage of trading using opposite East Resources and Axalta Coating positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if East Resources position performs unexpectedly, Axalta Coating 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 Axalta Coating will offset losses from the drop in Axalta Coating's long position.| East Resources vs. Yuexiu Transport Infrastructure | East Resources vs. CenterPoint Energy | East Resources vs. Delek Logistics Partners | East Resources vs. Aris Water Solutions |
| Axalta Coating vs. Avient Corp | Axalta Coating vs. H B Fuller | Axalta Coating vs. Quaker Chemical | Axalta Coating vs. Cabot |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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