Correlation Between CHKEL Old and Focus Graphite

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

By analyzing existing cross correlation between CHKEL Old and Focus Graphite, you can compare the effects of market volatilities on CHKEL Old and Focus Graphite 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 CHKEL Old with a short position of Focus Graphite. Check out your portfolio center. Please also check ongoing floating volatility patterns of CHKEL Old and Focus Graphite.

Diversification Opportunities for CHKEL Old and Focus Graphite

0.0

Correlation Coefficient

CHKEL Old  Focus Graphite

Pay attention - limited upside

The 3 months correlation between CHKEL and Focus is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding CHKEL Old and Focus Graphite in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Focus Graphite and CHKEL Old 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 CHKEL Old are associated (or correlated) with Focus Graphite. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Focus Graphite has no effect on the direction of CHKEL Old i.e., CHKEL Old and Focus Graphite go up and down completely randomly.

Pair Corralation between CHKEL Old and Focus Graphite

If you would invest  5.00  in Focus Graphite on December 1, 2024 and sell it today you would earn a total of  1.49  from holding Focus Graphite or generate 29.8% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

CHKEL Old  vs.  Focus Graphite

CHKEL Old

Risk-Adjusted Performance

Very Weak

Over the last 90 days CHKEL Old has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent technical and fundamental indicators, CHKEL Old is not utilizing all of its potentials. The current stock price mess, may contribute to short-term losses for the institutional investors.

Focus Graphite

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Focus Graphite are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile primary indicators, Focus Graphite reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with CHKEL Old and Focus Graphite

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

The idea behind CHKEL Old and Focus Graphite 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.