Correlation Between JSC Halyk and Chesapeake Utilities

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

By analyzing existing cross correlation between JSC Halyk bank and Chesapeake Utilities, you can compare the effects of market volatilities on JSC Halyk and Chesapeake Utilities 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 JSC Halyk with a short position of Chesapeake Utilities. Check out your portfolio center. Please also check ongoing floating volatility patterns of JSC Halyk and Chesapeake Utilities.

Diversification Opportunities for JSC Halyk and Chesapeake Utilities

-0.11

Correlation Coefficient

JSC Halyk  Chesapeake Utilities

Good diversification

The 3 months correlation between JSC and Chesapeake is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding JSC Halyk bank and Chesapeake Utilities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chesapeake Utilities and JSC Halyk 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 JSC Halyk bank are associated (or correlated) with Chesapeake Utilities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chesapeake Utilities has no effect on the direction of JSC Halyk i.e., JSC Halyk and Chesapeake Utilities go up and down completely randomly.

Pair Corralation between JSC Halyk and Chesapeake Utilities

Assuming the 90 days trading horizon JSC Halyk bank is expected to generate 2.26 times more return on investment than Chesapeake Utilities. However, JSC Halyk is 2.26 times more volatile than Chesapeake Utilities. It trades about 0.07 of its potential returns per unit of risk. Chesapeake Utilities is currently generating about 0.04 per unit of risk. If you would invest  1,750  in JSC Halyk bank on December 22, 2024 and sell it today you would earn a total of  180.00  from holding JSC Halyk bank or generate 10.29% return on investment over 90 days.

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

JSC Halyk bank  vs.  Chesapeake Utilities

JSC Halyk bank

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in JSC Halyk bank are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile essential indicators, JSC Halyk reported solid returns over the last few months and may actually be approaching a breakup point.

Chesapeake Utilities

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Chesapeake Utilities are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, Chesapeake Utilities is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with JSC Halyk and Chesapeake Utilities

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

The idea behind JSC Halyk bank and Chesapeake Utilities 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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.