Correlation Between SEKISUI CHEMICAL and Eskay Mining
Can any of the company-specific risk be diversified away by investing in both SEKISUI CHEMICAL and Eskay Mining 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 SEKISUI CHEMICAL and Eskay Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SEKISUI CHEMICAL and Eskay Mining Corp, you can compare the effects of market volatilities on SEKISUI CHEMICAL and Eskay Mining 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 SEKISUI CHEMICAL with a short position of Eskay Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of SEKISUI CHEMICAL and Eskay Mining.
Diversification Opportunities for SEKISUI CHEMICAL and Eskay Mining
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between SEKISUI and Eskay is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding SEKISUI CHEMICAL and Eskay Mining Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eskay Mining Corp and SEKISUI CHEMICAL 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 SEKISUI CHEMICAL are associated (or correlated) with Eskay Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eskay Mining Corp has no effect on the direction of SEKISUI CHEMICAL i.e., SEKISUI CHEMICAL and Eskay Mining go up and down completely randomly.
Pair Corralation between SEKISUI CHEMICAL and Eskay Mining
Assuming the 90 days trading horizon SEKISUI CHEMICAL is expected to generate 0.6 times more return on investment than Eskay Mining. However, SEKISUI CHEMICAL is 1.67 times less risky than Eskay Mining. It trades about 0.12 of its potential returns per unit of risk. Eskay Mining Corp is currently generating about -0.07 per unit of risk. If you would invest 1,450 in SEKISUI CHEMICAL on October 16, 2024 and sell it today you would earn a total of 90.00 from holding SEKISUI CHEMICAL or generate 6.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SEKISUI CHEMICAL vs. Eskay Mining Corp
Performance |
| Timeline |
| SEKISUI CHEMICAL |
| Eskay Mining Corp |
SEKISUI CHEMICAL and Eskay Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SEKISUI CHEMICAL and Eskay Mining
The main advantage of trading using opposite SEKISUI CHEMICAL and Eskay Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SEKISUI CHEMICAL position performs unexpectedly, Eskay Mining 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 Eskay Mining will offset losses from the drop in Eskay Mining's long position.| SEKISUI CHEMICAL vs. CyberArk Software | SEKISUI CHEMICAL vs. Unity Software | SEKISUI CHEMICAL vs. Cairo Communication SpA | SEKISUI CHEMICAL vs. FORMPIPE SOFTWARE AB |
| Eskay Mining vs. Plastic Omnium | Eskay Mining vs. Applied Materials | Eskay Mining vs. Rayonier Advanced Materials | Eskay Mining vs. Heidelberg Materials AG |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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