Correlation Between CHEVRON and International Business
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By analyzing existing cross correlation between CHEVRON USA INC and International Business Machines, you can compare the effects of market volatilities on CHEVRON and International Business 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 CHEVRON with a short position of International Business. Check out your portfolio center. Please also check ongoing floating volatility patterns of CHEVRON and International Business.
Diversification Opportunities for CHEVRON and International Business
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between CHEVRON and International is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding CHEVRON USA INC and International Business Machine in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on International Business and CHEVRON 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 CHEVRON USA INC are associated (or correlated) with International Business. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of International Business has no effect on the direction of CHEVRON i.e., CHEVRON and International Business go up and down completely randomly.
Pair Corralation between CHEVRON and International Business
Assuming the 90 days trading horizon CHEVRON USA INC is expected to under-perform the International Business. In addition to that, CHEVRON is 1.24 times more volatile than International Business Machines. It trades about 0.0 of its total potential returns per unit of risk. International Business Machines is currently generating about 0.09 per unit of volatility. If you would invest 13,719 in International Business Machines on September 2, 2024 and sell it today you would earn a total of 9,022 from holding International Business Machines or generate 65.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 73.19% |
| Values | Daily Returns |
CHEVRON USA INC vs. International Business Machine
Performance |
| Timeline |
| CHEVRON USA INC |
| International Business |
CHEVRON and International Business Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CHEVRON and International Business
The main advantage of trading using opposite CHEVRON and International Business positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CHEVRON position performs unexpectedly, International Business 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 International Business will offset losses from the drop in International Business' long position.| CHEVRON vs. AEP TEX INC | CHEVRON vs. US BANK NATIONAL | CHEVRON vs. Bank of America | CHEVRON vs. GE Aerospace |
| International Business vs. EPAM Systems | International Business vs. Infosys Ltd ADR | International Business vs. Cognizant Technology Solutions | International Business vs. FiscalNote Holdings |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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