Correlation Between South Jersey and Axalta Coating
Can any of the company-specific risk be diversified away by investing in both South Jersey 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 South Jersey and Axalta Coating into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between South Jersey Industries and Axalta Coating Systems, you can compare the effects of market volatilities on South Jersey 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 South Jersey with a short position of Axalta Coating. Check out your portfolio center. Please also check ongoing floating volatility patterns of South Jersey and Axalta Coating.
Diversification Opportunities for South Jersey and Axalta Coating
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between South and Axalta is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding South Jersey Industries 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 South Jersey 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 South Jersey Industries 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 South Jersey i.e., South Jersey and Axalta Coating go up and down completely randomly.
Pair Corralation between South Jersey and Axalta Coating
If you would invest 3,407 in Axalta Coating Systems on November 3, 2024 and sell it today you would earn a total of 187.00 from holding Axalta Coating Systems or generate 5.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 0.8% |
| Values | Daily Returns |
South Jersey Industries vs. Axalta Coating Systems
Performance |
| Timeline |
| South Jersey Industries |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Axalta Coating Systems |
South Jersey and Axalta Coating Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with South Jersey and Axalta Coating
The main advantage of trading using opposite South Jersey and Axalta Coating positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if South Jersey 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.| South Jersey vs. Summit Hotel Properties | South Jersey vs. WK Kellogg Co | South Jersey vs. RCI Hospitality Holdings | South Jersey vs. The Cheesecake Factory |
| 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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