Stepan Correlations

SCL Stock

USD 76.00 0.65 0.86%

The current 90-days correlation between Stepan Company and Innospec is 0.88 (i.e., Very poor diversification). A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as Stepan moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if Stepan Company moves in either direction, the perfectly negatively correlated security will move in the opposite direction.

Stepan Correlation With Market

Poor diversification

The correlation between Stepan Company and DJI is 0.74 (i.e., Poor diversification) for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding Stepan Company and DJI in the same portfolio, assuming nothing else is changed.

Check out World Market Map to better understand how to build diversified portfolios, which includes a position in Stepan Company. Also, note that the market value of any company could be closely tied with the direction of predictive economic indicators such as signals in main economic indicators.

Moving together with Stepan Stock

0.7	CC	Chemours Buyout Trend	Pair Corr
0.62	KOP	Koppers Holdings	Pair Corr
0.8	KWR	Quaker Chemical	Pair Corr
0.64	SXT	Sensient Technologies	Pair Corr

Related Correlations Analysis

	IOSP	MTX	ODC	KWR	SXT	FUL	AVNT
IOSP		0.84	0.64	0.74	0.69	0.01	0.84	IOSP
MTX	0.84		0.7	0.36	0.69	-0.37	0.82	MTX
ODC	0.64	0.7		0.38	0.74	-0.17	0.67	ODC
KWR	0.74	0.36	0.38		0.43	0.48	0.5	KWR
SXT	0.69	0.69	0.74	0.43		-0.11	0.89	SXT
FUL	0.01	-0.37	-0.17	0.48	-0.11		-0.11	FUL
AVNT	0.84	0.82	0.67	0.5	0.89	-0.11		AVNT
	IOSP	MTX	ODC	KWR	SXT	FUL	AVNT

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Correlation Matchups

Over a given time period, the two securities move together when the Correlation Coefficient is positive. Conversely, the two assets move in opposite directions when the Correlation Coefficient is negative. Determining your positions' relationship to each other is valuable for analyzing and projecting your portfolio's future expected return and risk.

High positive correlations

AVNT	+ 0.89	SXT
MTX	+ 0.84	IOSP
AVNT	+ 0.84	IOSP
AVNT	+ 0.82	MTX
KWR	+ 0.74	IOSP
SXT	+ 0.74	ODC

High negative correlations

FUL	- 0.37	MTX
FUL	- 0.17	ODC
AVNT	- 0.11	FUL
FUL	- 0.11	SXT

Risk-Adjusted Indicators

There is a big difference between Stepan Stock performing well and Stepan Company doing well as a business compared to the competition. There are so many exceptions to the norm that investors cannot definitively determine what's good or bad unless they analyze Stepan's multiple risk-adjusted performance indicators across the competitive landscape. These indicators are quantitative in nature and help investors forecast volatility and risk-adjusted expected returns across various positions.

	Mean Deviation	Jensen Alpha	Sortino Ratio	Treynor Ratio	Semi Deviation	Expected Shortfall	Potential Upside	Value @Risk	Maximum Drawdown
IOSP	1.27	(0.05)	0.04	0.06	1.30	(1.41)	2.24	(2.10)	16.32
MTX	1.28	(0.04)	0.03	0.07	1.32	(1.45)	2.46	(2.51)	11.90
ODC	1.32	(0.01)	0.00	0.08	1.62	(1.34)	3.14	(2.09)	12.06
KWR	1.50	(0.15)	(0.02)	0.02	1.84	(1.55)	2.37	(2.62)	18.04
SXT	1.06	(0.05)	0.00	0.06	1.24	(1.09)	2.28	(2.19)	8.84
FUL	1.04	(0.23)	0.00	(0.07)	0.00	0.00	1.79	(2.51)	8.58
AVNT	1.34	(0.01)	0.04	0.08	1.43	(1.49)	3.08	(2.41)	7.92

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