Correlation Between Panther Metals and Eastman Chemical
Can any of the company-specific risk be diversified away by investing in both Panther Metals and Eastman 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 Panther Metals and Eastman Chemical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Panther Metals PLC and Eastman Chemical Co, you can compare the effects of market volatilities on Panther Metals and Eastman 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 Panther Metals with a short position of Eastman Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Panther Metals and Eastman Chemical.
Diversification Opportunities for Panther Metals and Eastman Chemical
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Panther and Eastman is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Panther Metals PLC and Eastman Chemical Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eastman Chemical and Panther Metals 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 Panther Metals PLC are associated (or correlated) with Eastman Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eastman Chemical has no effect on the direction of Panther Metals i.e., Panther Metals and Eastman Chemical go up and down completely randomly.
Pair Corralation between Panther Metals and Eastman Chemical
Assuming the 90 days trading horizon Panther Metals PLC is expected to generate 50.2 times more return on investment than Eastman Chemical. However, Panther Metals is 50.2 times more volatile than Eastman Chemical Co. It trades about 0.08 of its potential returns per unit of risk. Eastman Chemical Co is currently generating about 0.04 per unit of risk. If you would invest 505.00 in Panther Metals PLC on August 24, 2024 and sell it today you would earn a total of 11,745 from holding Panther Metals PLC or generate 2325.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 89.47% |
| Values | Daily Returns |
Panther Metals PLC vs. Eastman Chemical Co
Performance |
| Timeline |
| Panther Metals PLC |
| Eastman Chemical |
Panther Metals and Eastman Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Panther Metals and Eastman Chemical
The main advantage of trading using opposite Panther Metals and Eastman Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Panther Metals position performs unexpectedly, Eastman 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 Eastman Chemical will offset losses from the drop in Eastman Chemical's long position.| Panther Metals vs. Givaudan SA | Panther Metals vs. Antofagasta PLC | Panther Metals vs. Centamin PLC | Panther Metals vs. Atalaya Mining |
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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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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