Correlation Between Westlake Chemical and Ion Beam
Can any of the company-specific risk be diversified away by investing in both Westlake Chemical and Ion Beam 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 Westlake Chemical and Ion Beam into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Westlake Chemical Corp and Ion Beam Applications, you can compare the effects of market volatilities on Westlake Chemical and Ion Beam 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 Westlake Chemical with a short position of Ion Beam. Check out your portfolio center. Please also check ongoing floating volatility patterns of Westlake Chemical and Ion Beam.
Diversification Opportunities for Westlake Chemical and Ion Beam
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Westlake and Ion is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Westlake Chemical Corp and Ion Beam Applications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ion Beam Applications and Westlake Chemical 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 Westlake Chemical Corp are associated (or correlated) with Ion Beam. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ion Beam Applications has no effect on the direction of Westlake Chemical i.e., Westlake Chemical and Ion Beam go up and down completely randomly.
Pair Corralation between Westlake Chemical and Ion Beam
Assuming the 90 days trading horizon Westlake Chemical Corp is expected to generate 0.99 times more return on investment than Ion Beam. However, Westlake Chemical Corp is 1.01 times less risky than Ion Beam. It trades about 0.04 of its potential returns per unit of risk. Ion Beam Applications is currently generating about 0.0 per unit of risk. If you would invest 9,864 in Westlake Chemical Corp on September 3, 2024 and sell it today you would earn a total of 3,000 from holding Westlake Chemical Corp or generate 30.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 76.51% |
| Values | Daily Returns |
Westlake Chemical Corp vs. Ion Beam Applications
Performance |
| Timeline |
| Westlake Chemical Corp |
| Ion Beam Applications |
Westlake Chemical and Ion Beam Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Westlake Chemical and Ion Beam
The main advantage of trading using opposite Westlake Chemical and Ion Beam positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Westlake Chemical position performs unexpectedly, Ion Beam 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 Ion Beam will offset losses from the drop in Ion Beam's long position.| Westlake Chemical vs. Qurate Retail Series | Westlake Chemical vs. JB Hunt Transport | Westlake Chemical vs. Coor Service Management | Westlake Chemical vs. Roebuck Food Group |
| Ion Beam vs. Catalyst Media Group | Ion Beam vs. CATLIN GROUP | Ion Beam vs. RTW Venture Fund | Ion Beam vs. Secure Property Development |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
Other Complementary Tools
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world |