Correlation Between Regency Centers and Chemours

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

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

Diversification Opportunities for Regency Centers and Chemours

0.08

Correlation Coefficient

Regency Centers  Chemours

Significant diversification

The 3 months correlation between Regency and Chemours is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Regency Centers and Chemours Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chemours and Regency Centers 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 Regency Centers are associated (or correlated) with Chemours. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chemours has no effect on the direction of Regency Centers i.e., Regency Centers and Chemours go up and down completely randomly.

Pair Corralation between Regency Centers and Chemours

Assuming the 90 days horizon Regency Centers is expected to generate 10.94 times less return on investment than Chemours. But when comparing it to its historical volatility, Regency Centers is 4.55 times less risky than Chemours. It trades about 0.03 of its potential returns per unit of risk. Chemours Co is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  1,693  in Chemours Co on September 12, 2024 and sell it today you would earn a total of  249.00  from holding Chemours Co or generate 14.71% return on investment over 90 days.

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

Regency Centers  vs.  Chemours Co

Regency Centers

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Regency Centers are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable fundamental indicators, Regency Centers is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Chemours

Risk-Adjusted Performance

6 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Chemours Co are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile fundamental indicators, Chemours exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Regency Centers and Chemours

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

The idea behind Regency Centers and Chemours 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.