Correlation Between Neo Performance and Chemours
Can any of the company-specific risk be diversified away by investing in both Neo Performance and Chemours 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 Neo Performance and Chemours into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Neo Performance Materials and Chemours Co, you can compare the effects of market volatilities on Neo Performance and Chemours 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 Neo Performance with a short position of Chemours. Check out your portfolio center. Please also check ongoing floating volatility patterns of Neo Performance and Chemours.
Diversification Opportunities for Neo Performance and Chemours
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between Neo and Chemours is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Neo Performance Materials and Chemours Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chemours and Neo Performance 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 Neo Performance Materials are associated (or correlated) with Chemours. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chemours has no effect on the direction of Neo Performance i.e., Neo Performance and Chemours go up and down completely randomly.
Pair Corralation between Neo Performance and Chemours
Assuming the 90 days horizon Neo Performance is expected to generate 1.82 times less return on investment than Chemours. In addition to that, Neo Performance is 1.24 times more volatile than Chemours Co. It trades about 0.1 of its total potential returns per unit of risk. Chemours Co is currently generating about 0.23 per unit of volatility. If you would invest 1,905 in Chemours Co on September 13, 2024 and sell it today you would earn a total of 212.00 from holding Chemours Co or generate 11.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Neo Performance Materials vs. Chemours Co
Performance |
| Timeline |
| Neo Performance Materials |
| Chemours |
Neo Performance and Chemours Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Neo Performance and Chemours
The main advantage of trading using opposite Neo Performance and Chemours positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Neo Performance position performs unexpectedly, Chemours 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 Chemours will offset losses from the drop in Chemours' long position.| Neo Performance vs. Mativ Holdings | Neo Performance vs. Sensient Technologies | Neo Performance vs. Koppers Holdings | Neo Performance vs. Axalta Coating Systems |
| Chemours vs. International Flavors Fragrances | Chemours vs. Air Products and | Chemours vs. PPG Industries | Chemours vs. Linde plc Ordinary |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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