Correlation Between Symrise Ag and Quaker Chemical
Can any of the company-specific risk be diversified away by investing in both Symrise Ag and Quaker 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 Symrise Ag and Quaker Chemical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Symrise Ag PK and Quaker Chemical, you can compare the effects of market volatilities on Symrise Ag and Quaker 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 Symrise Ag with a short position of Quaker Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Symrise Ag and Quaker Chemical.
Diversification Opportunities for Symrise Ag and Quaker Chemical
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between Symrise and Quaker is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Symrise Ag PK and Quaker Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Quaker Chemical and Symrise Ag 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 Symrise Ag PK are associated (or correlated) with Quaker Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Quaker Chemical has no effect on the direction of Symrise Ag i.e., Symrise Ag and Quaker Chemical go up and down completely randomly.
Pair Corralation between Symrise Ag and Quaker Chemical
Assuming the 90 days horizon Symrise Ag PK is expected to generate 0.64 times more return on investment than Quaker Chemical. However, Symrise Ag PK is 1.56 times less risky than Quaker Chemical. It trades about 0.01 of its potential returns per unit of risk. Quaker Chemical is currently generating about 0.0 per unit of risk. If you would invest 2,726 in Symrise Ag PK on August 24, 2024 and sell it today you would lose (9.00) from holding Symrise Ag PK or give up 0.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Symrise Ag PK vs. Quaker Chemical
Performance |
| Timeline |
| Symrise Ag PK |
| Quaker Chemical |
Symrise Ag and Quaker Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Symrise Ag and Quaker Chemical
The main advantage of trading using opposite Symrise Ag and Quaker Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Symrise Ag position performs unexpectedly, Quaker 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 Quaker Chemical will offset losses from the drop in Quaker Chemical's long position.| Symrise Ag vs. Givaudan SA ADR | Symrise Ag vs. Sysmex Corp | Symrise Ag vs. Shin Etsu Chemical Co | Symrise Ag vs. Brenntag AG ADR |
| Quaker Chemical vs. Minerals Technologies | Quaker Chemical vs. Innospec | Quaker Chemical vs. H B Fuller | Quaker Chemical 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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