Correlation Between Chemours and Celanese
Can any of the company-specific risk be diversified away by investing in both Chemours and Celanese 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 Chemours and Celanese into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chemours Co and Celanese, you can compare the effects of market volatilities on Chemours and Celanese 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 Chemours with a short position of Celanese. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chemours and Celanese.
Diversification Opportunities for Chemours and Celanese
Very good diversification
The 3 months correlation between Chemours and Celanese is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Chemours Co and Celanese in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Celanese and Chemours 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 Chemours Co are associated (or correlated) with Celanese. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Celanese has no effect on the direction of Chemours i.e., Chemours and Celanese go up and down completely randomly.
Pair Corralation between Chemours and Celanese
Allowing for the 90-day total investment horizon Chemours is expected to generate 4.12 times less return on investment than Celanese. In addition to that, Chemours is 2.12 times more volatile than Celanese. It trades about 0.01 of its total potential returns per unit of risk. Celanese is currently generating about 0.1 per unit of volatility. If you would invest 10,295 in Celanese on January 25, 2024 and sell it today you would earn a total of 5,310 from holding Celanese or generate 51.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chemours Co vs. Celanese
Performance |
| Timeline |
| Chemours |
| Celanese |
Chemours and Celanese Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chemours and Celanese
The main advantage of trading using opposite Chemours and Celanese positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chemours position performs unexpectedly, Celanese 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 Celanese will offset losses from the drop in Celanese's long position.| Chemours vs. Olin Corporation | Chemours vs. Cabot | Chemours vs. Kronos Worldwide | Chemours vs. LyondellBasell Industries NV |
| Celanese vs. Huntsman | Celanese vs. Lsb Industries | Celanese vs. Westlake Chemical Partners | Celanese vs. Green Plains Renewable |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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