Correlation Between Marubeni and SEKISUI CHEMICAL
Can any of the company-specific risk be diversified away by investing in both Marubeni and SEKISUI CHEMICAL 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 Marubeni and SEKISUI CHEMICAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Marubeni and SEKISUI CHEMICAL, you can compare the effects of market volatilities on Marubeni and SEKISUI CHEMICAL 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 Marubeni with a short position of SEKISUI CHEMICAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Marubeni and SEKISUI CHEMICAL.
Diversification Opportunities for Marubeni and SEKISUI CHEMICAL
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between Marubeni and SEKISUI is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Marubeni and SEKISUI CHEMICAL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SEKISUI CHEMICAL and Marubeni 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 Marubeni are associated (or correlated) with SEKISUI CHEMICAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SEKISUI CHEMICAL has no effect on the direction of Marubeni i.e., Marubeni and SEKISUI CHEMICAL go up and down completely randomly.
Pair Corralation between Marubeni and SEKISUI CHEMICAL
Assuming the 90 days trading horizon Marubeni is expected to generate 2.28 times less return on investment than SEKISUI CHEMICAL. In addition to that, Marubeni is 1.52 times more volatile than SEKISUI CHEMICAL. It trades about 0.01 of its total potential returns per unit of risk. SEKISUI CHEMICAL is currently generating about 0.05 per unit of volatility. If you would invest 1,260 in SEKISUI CHEMICAL on September 12, 2024 and sell it today you would earn a total of 220.00 from holding SEKISUI CHEMICAL or generate 17.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Marubeni vs. SEKISUI CHEMICAL
Performance |
| Timeline |
| Marubeni |
| SEKISUI CHEMICAL |
Marubeni and SEKISUI CHEMICAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Marubeni and SEKISUI CHEMICAL
The main advantage of trading using opposite Marubeni and SEKISUI CHEMICAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Marubeni position performs unexpectedly, SEKISUI CHEMICAL 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 SEKISUI CHEMICAL will offset losses from the drop in SEKISUI CHEMICAL's long position.| Marubeni vs. Entravision Communications | Marubeni vs. Highlight Communications AG | Marubeni vs. Magnachip Semiconductor | Marubeni vs. Shenandoah Telecommunications |
| SEKISUI CHEMICAL vs. Apple Inc | SEKISUI CHEMICAL vs. Apple Inc | SEKISUI CHEMICAL vs. Apple Inc | SEKISUI CHEMICAL vs. Apple Inc |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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