Correlation Between Chemours and 1248EPCK7

Can any of the company-specific risk be diversified away by investing in both Chemours and 1248EPCK7 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 Chemours and 1248EPCK7 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Chemours Co and CCO HLDGS LLC, you can compare the effects of market volatilities on Chemours and 1248EPCK7 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 Chemours with a short position of 1248EPCK7. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chemours and 1248EPCK7.

Diversification Opportunities for Chemours and 1248EPCK7

0.42

Correlation Coefficient

Chemours  1248EPCK7

Very weak diversification

The 3 months correlation between Chemours and 1248EPCK7 is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Chemours Co and CCO HLDGS LLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CCO HLDGS LLC and Chemours 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 Chemours Co are associated (or correlated) with 1248EPCK7. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CCO HLDGS LLC has no effect on the direction of Chemours i.e., Chemours and 1248EPCK7 go up and down completely randomly.

Pair Corralation between Chemours and 1248EPCK7

Allowing for the 90-day total investment horizon Chemours Co is expected to under-perform the 1248EPCK7. In addition to that, Chemours is 2.46 times more volatile than CCO HLDGS LLC. It trades about -0.08 of its total potential returns per unit of risk. CCO HLDGS LLC is currently generating about -0.09 per unit of volatility. If you would invest  8,728  in CCO HLDGS LLC on December 30, 2024 and sell it today you would lose (653.00) from holding CCO HLDGS LLC or give up 7.48% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	96.88%
Values	Daily Returns

Chemours Co  vs.  CCO HLDGS LLC

Chemours

Risk-Adjusted Performance

Very Weak

Over the last 90 days Chemours Co has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile performance in the last few months, the Stock's fundamental indicators remain rather sound which may send shares a bit higher in April 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

CCO HLDGS LLC

Risk-Adjusted Performance

Very Weak

Over the last 90 days CCO HLDGS LLC has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Bond's basic indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for CCO HLDGS LLC shareholders.

Pair Trading with Chemours and 1248EPCK7

The main advantage of trading using opposite Chemours and 1248EPCK7 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chemours position performs unexpectedly, 1248EPCK7 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 1248EPCK7 will offset losses from the drop in 1248EPCK7's long position.

The idea behind Chemours Co and CCO HLDGS LLC pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.