Correlation Between Eco Atlantic and Chartwell Retirement

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

By analyzing existing cross correlation between Eco Atlantic Oil and Chartwell Retirement Residences, you can compare the effects of market volatilities on Eco Atlantic and Chartwell Retirement 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 Eco Atlantic with a short position of Chartwell Retirement. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eco Atlantic and Chartwell Retirement.

Diversification Opportunities for Eco Atlantic and Chartwell Retirement

-0.7

Correlation Coefficient

Eco Atlantic  Chartwell Retirement

Excellent diversification

The 3 months correlation between Eco and Chartwell is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Eco Atlantic Oil and Chartwell Retirement Residence in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chartwell Retirement and Eco Atlantic 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 Eco Atlantic Oil are associated (or correlated) with Chartwell Retirement. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chartwell Retirement has no effect on the direction of Eco Atlantic i.e., Eco Atlantic and Chartwell Retirement go up and down completely randomly.

Pair Corralation between Eco Atlantic and Chartwell Retirement

Assuming the 90 days horizon Eco Atlantic Oil is expected to under-perform the Chartwell Retirement. In addition to that, Eco Atlantic is 3.31 times more volatile than Chartwell Retirement Residences. It trades about -0.06 of its total potential returns per unit of risk. Chartwell Retirement Residences is currently generating about 0.15 per unit of volatility. If you would invest  1,508  in Chartwell Retirement Residences on December 31, 2024 and sell it today you would earn a total of  163.00  from holding Chartwell Retirement Residences or generate 10.81% return on investment over 90 days.

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

Eco Atlantic Oil  vs.  Chartwell Retirement Residence

Eco Atlantic Oil

Risk-Adjusted Performance

Very Weak

Over the last 90 days Eco Atlantic Oil has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in May 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Chartwell Retirement

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Chartwell Retirement Residences are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unfluctuating technical indicators, Chartwell Retirement may actually be approaching a critical reversion point that can send shares even higher in May 2025.

Pair Trading with Eco Atlantic and Chartwell Retirement

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

The idea behind Eco Atlantic Oil and Chartwell Retirement Residences 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.

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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.