Correlation Between Summit Midstream and Coupang LLC
Can any of the company-specific risk be diversified away by investing in both Summit Midstream and Coupang LLC 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 Summit Midstream and Coupang LLC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Summit Midstream and Coupang LLC, you can compare the effects of market volatilities on Summit Midstream and Coupang LLC 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 Summit Midstream with a short position of Coupang LLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Summit Midstream and Coupang LLC.
Diversification Opportunities for Summit Midstream and Coupang LLC
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Summit and Coupang is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Summit Midstream and Coupang LLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coupang LLC and Summit Midstream 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 Summit Midstream are associated (or correlated) with Coupang LLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Coupang LLC has no effect on the direction of Summit Midstream i.e., Summit Midstream and Coupang LLC go up and down completely randomly.
Pair Corralation between Summit Midstream and Coupang LLC
Considering the 90-day investment horizon Summit Midstream is expected to generate 1.48 times more return on investment than Coupang LLC. However, Summit Midstream is 1.48 times more volatile than Coupang LLC. It trades about 0.07 of its potential returns per unit of risk. Coupang LLC is currently generating about 0.04 per unit of risk. If you would invest 1,723 in Summit Midstream on October 26, 2024 and sell it today you would earn a total of 2,565 from holding Summit Midstream or generate 148.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Summit Midstream vs. Coupang LLC
Performance |
| Timeline |
| Summit Midstream |
| Coupang LLC |
Summit Midstream and Coupang LLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Summit Midstream and Coupang LLC
The main advantage of trading using opposite Summit Midstream and Coupang LLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Summit Midstream position performs unexpectedly, Coupang LLC 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 Coupang LLC will offset losses from the drop in Coupang LLC's long position.| Summit Midstream vs. Griffon | Summit Midstream vs. Vasta Platform | Summit Midstream vs. Tritent International Agriculture | Summit Midstream vs. Jacobs Solutions |
| Coupang LLC vs. MercadoLibre | Coupang LLC vs. PDD Holdings | Coupang LLC vs. JD Inc Adr | Coupang LLC vs. Alibaba Group Holding |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
Other Complementary Tools
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities |