Correlation Between Eastman Chemical and Kura Sushi

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

By analyzing existing cross correlation between Eastman Chemical and Kura Sushi USA, you can compare the effects of market volatilities on Eastman Chemical and Kura Sushi 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 Eastman Chemical with a short position of Kura Sushi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eastman Chemical and Kura Sushi.

Diversification Opportunities for Eastman Chemical and Kura Sushi

-0.19

Correlation Coefficient

Eastman Chemical  Kura Sushi

Good diversification

The 3 months correlation between Eastman and Kura is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Eastman Chemical and Kura Sushi USA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kura Sushi USA and Eastman Chemical 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 Eastman Chemical are associated (or correlated) with Kura Sushi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kura Sushi USA has no effect on the direction of Eastman Chemical i.e., Eastman Chemical and Kura Sushi go up and down completely randomly.

Pair Corralation between Eastman Chemical and Kura Sushi

Considering the 90-day investment horizon Eastman Chemical is expected to generate 0.41 times more return on investment than Kura Sushi. However, Eastman Chemical is 2.45 times less risky than Kura Sushi. It trades about 0.0 of its potential returns per unit of risk. Kura Sushi USA is currently generating about -0.16 per unit of risk. If you would invest  8,998  in Eastman Chemical on December 28, 2024 and sell it today you would lose (106.00) from holding Eastman Chemical or give up 1.18% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Eastman Chemical  vs.  Kura Sushi USA

Eastman Chemical

Risk-Adjusted Performance

Very Weak

Over the last 90 days Eastman Chemical has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy primary indicators, Eastman Chemical is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Kura Sushi USA

Risk-Adjusted Performance

Very Weak

Over the last 90 days Kura Sushi USA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Eastman Chemical and Kura Sushi

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

The idea behind Eastman Chemical and Kura Sushi USA 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.