Correlation Between Eastman Kodak and Capitalworks Emerging
Can any of the company-specific risk be diversified away by investing in both Eastman Kodak and Capitalworks Emerging 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 Kodak and Capitalworks Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eastman Kodak Co and Capitalworks Emerging Markets, you can compare the effects of market volatilities on Eastman Kodak and Capitalworks Emerging 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 Kodak with a short position of Capitalworks Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eastman Kodak and Capitalworks Emerging.
Diversification Opportunities for Eastman Kodak and Capitalworks Emerging
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Eastman and Capitalworks is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Eastman Kodak Co and Capitalworks Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Capitalworks Emerging and Eastman Kodak 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 Kodak Co are associated (or correlated) with Capitalworks Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Capitalworks Emerging has no effect on the direction of Eastman Kodak i.e., Eastman Kodak and Capitalworks Emerging go up and down completely randomly.
Pair Corralation between Eastman Kodak and Capitalworks Emerging
If you would invest 472.00 in Eastman Kodak Co on September 2, 2024 and sell it today you would earn a total of 253.00 from holding Eastman Kodak Co or generate 53.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 4.76% |
| Values | Daily Returns |
Eastman Kodak Co vs. Capitalworks Emerging Markets
Performance |
| Timeline |
| Eastman Kodak |
| Capitalworks Emerging |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Eastman Kodak and Capitalworks Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eastman Kodak and Capitalworks Emerging
The main advantage of trading using opposite Eastman Kodak and Capitalworks Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eastman Kodak position performs unexpectedly, Capitalworks Emerging 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 Capitalworks Emerging will offset losses from the drop in Capitalworks Emerging's long position.| Eastman Kodak vs. SMX Public Limited | Eastman Kodak vs. System1 | Eastman Kodak vs. Lichen China Limited | Eastman Kodak vs. Team Inc |
| Capitalworks Emerging vs. Eastman Kodak Co | Capitalworks Emerging vs. Saia Inc | Capitalworks Emerging vs. Olympic Steel | Capitalworks Emerging vs. Century Aluminum |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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