Correlation Between Eagle Capital and Chartwell Small

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

By analyzing existing cross correlation between Eagle Capital Appreciation and Chartwell Small Cap, you can compare the effects of market volatilities on Eagle Capital and Chartwell Small 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 Eagle Capital with a short position of Chartwell Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eagle Capital and Chartwell Small.

Diversification Opportunities for Eagle Capital and Chartwell Small

0.75

Correlation Coefficient

Eagle Capital  Chartwell Small

Poor diversification

The 3 months correlation between Eagle and Chartwell is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Eagle Capital Appreciation and Chartwell Small Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chartwell Small Cap and Eagle Capital 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 Eagle Capital Appreciation are associated (or correlated) with Chartwell Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chartwell Small Cap has no effect on the direction of Eagle Capital i.e., Eagle Capital and Chartwell Small go up and down completely randomly.

Pair Corralation between Eagle Capital and Chartwell Small

Assuming the 90 days horizon Eagle Capital Appreciation is expected to generate 0.62 times more return on investment than Chartwell Small. However, Eagle Capital Appreciation is 1.62 times less risky than Chartwell Small. It trades about 0.23 of its potential returns per unit of risk. Chartwell Small Cap is currently generating about 0.07 per unit of risk. If you would invest  6,084  in Eagle Capital Appreciation on May 17, 2025 and sell it today you would earn a total of  725.00  from holding Eagle Capital Appreciation or generate 11.92% return on investment over 90 days.

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

Eagle Capital Appreciation  vs.  Chartwell Small Cap

Eagle Capital Apprec

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Eagle Capital Appreciation are ranked lower than 17 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak forward indicators, Eagle Capital may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Chartwell Small Cap

Risk-Adjusted Performance

Mild

Compared to the overall equity markets, risk-adjusted returns on investments in Chartwell Small Cap are ranked lower than 5 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward indicators, Chartwell Small is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Eagle Capital and Chartwell Small

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

The idea behind Eagle Capital Appreciation and Chartwell Small Cap 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.