Correlation Between CHEMICAL INDUSTRIES and MidCap Financial
Can any of the company-specific risk be diversified away by investing in both CHEMICAL INDUSTRIES and MidCap Financial 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 CHEMICAL INDUSTRIES and MidCap Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CHEMICAL INDUSTRIES and MidCap Financial Investment, you can compare the effects of market volatilities on CHEMICAL INDUSTRIES and MidCap Financial 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 CHEMICAL INDUSTRIES with a short position of MidCap Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of CHEMICAL INDUSTRIES and MidCap Financial.
Diversification Opportunities for CHEMICAL INDUSTRIES and MidCap Financial
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between CHEMICAL and MidCap is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding CHEMICAL INDUSTRIES and MidCap Financial Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MidCap Financial Inv and CHEMICAL INDUSTRIES 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 CHEMICAL INDUSTRIES are associated (or correlated) with MidCap Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MidCap Financial Inv has no effect on the direction of CHEMICAL INDUSTRIES i.e., CHEMICAL INDUSTRIES and MidCap Financial go up and down completely randomly.
Pair Corralation between CHEMICAL INDUSTRIES and MidCap Financial
If you would invest 1,311 in MidCap Financial Investment on November 7, 2024 and sell it today you would earn a total of 43.00 from holding MidCap Financial Investment or generate 3.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
CHEMICAL INDUSTRIES vs. MidCap Financial Investment
Performance |
| Timeline |
| CHEMICAL INDUSTRIES |
| MidCap Financial Inv |
CHEMICAL INDUSTRIES and MidCap Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CHEMICAL INDUSTRIES and MidCap Financial
The main advantage of trading using opposite CHEMICAL INDUSTRIES and MidCap Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CHEMICAL INDUSTRIES position performs unexpectedly, MidCap Financial 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 MidCap Financial will offset losses from the drop in MidCap Financial's long position.| CHEMICAL INDUSTRIES vs. Hitachi Construction Machinery | CHEMICAL INDUSTRIES vs. Tower Semiconductor | CHEMICAL INDUSTRIES vs. TOREX SEMICONDUCTOR LTD | CHEMICAL INDUSTRIES vs. Magnachip Semiconductor |
| MidCap Financial vs. Salesforce | MidCap Financial vs. Gaming and Leisure | MidCap Financial vs. PLAYTECH | MidCap Financial vs. TRADELINK ELECTRON |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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