Correlation Between Chart Industries and Gannett

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

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

Diversification Opportunities for Chart Industries and Gannett

-0.13

Correlation Coefficient

Chart Industries  Gannett

Good diversification

The 3 months correlation between Chart and Gannett is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Chart Industries and Gannett Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gannett and Chart 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 Chart Industries are associated (or correlated) with Gannett. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gannett has no effect on the direction of Chart Industries i.e., Chart Industries and Gannett go up and down completely randomly.

Pair Corralation between Chart Industries and Gannett

Assuming the 90 days trading horizon Chart Industries is expected to generate 0.98 times more return on investment than Gannett. However, Chart Industries is 1.02 times less risky than Gannett. It trades about 0.27 of its potential returns per unit of risk. Gannett Co is currently generating about -0.11 per unit of risk. If you would invest  7,000  in Chart Industries on October 24, 2024 and sell it today you would earn a total of  863.00  from holding Chart Industries or generate 12.33% return on investment over 90 days.

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

Chart Industries  vs.  Gannett Co

Chart Industries

Risk-Adjusted Performance

25 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Chart Industries are ranked lower than 25 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak fundamental drivers, Chart Industries sustained solid returns over the last few months and may actually be approaching a breakup point.

Gannett

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Gannett Co has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest unfluctuating performance, the Stock's fundamental indicators remain strong and the recent confusion on Wall Street may also be a sign of long-lasting gains for the firm traders.

Pair Trading with Chart Industries and Gannett

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

The idea behind Chart Industries and Gannett Co 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.