Correlation Between Auction Technology and Westlake Chemical
Can any of the company-specific risk be diversified away by investing in both Auction Technology and Westlake Chemical 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 Auction Technology and Westlake Chemical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Auction Technology Group and Westlake Chemical Corp, you can compare the effects of market volatilities on Auction Technology and Westlake Chemical 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 Auction Technology with a short position of Westlake Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Auction Technology and Westlake Chemical.
Diversification Opportunities for Auction Technology and Westlake Chemical
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Auction and Westlake is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Auction Technology Group and Westlake Chemical Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Westlake Chemical Corp and Auction Technology 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 Auction Technology Group are associated (or correlated) with Westlake Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Westlake Chemical Corp has no effect on the direction of Auction Technology i.e., Auction Technology and Westlake Chemical go up and down completely randomly.
Pair Corralation between Auction Technology and Westlake Chemical
Assuming the 90 days trading horizon Auction Technology Group is expected to under-perform the Westlake Chemical. In addition to that, Auction Technology is 1.27 times more volatile than Westlake Chemical Corp. It trades about -0.01 of its total potential returns per unit of risk. Westlake Chemical Corp is currently generating about 0.03 per unit of volatility. If you would invest 10,993 in Westlake Chemical Corp on September 3, 2024 and sell it today you would earn a total of 1,899 from holding Westlake Chemical Corp or generate 17.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 78.38% |
| Values | Daily Returns |
Auction Technology Group vs. Westlake Chemical Corp
Performance |
| Timeline |
| Auction Technology |
| Westlake Chemical Corp |
Auction Technology and Westlake Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Auction Technology and Westlake Chemical
The main advantage of trading using opposite Auction Technology and Westlake Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Auction Technology position performs unexpectedly, Westlake Chemical 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 Westlake Chemical will offset losses from the drop in Westlake Chemical's long position.| Auction Technology vs. Samsung Electronics Co | Auction Technology vs. Samsung Electronics Co | Auction Technology vs. Hyundai Motor | Auction Technology vs. Toyota Motor Corp |
| Westlake Chemical vs. Qurate Retail Series | Westlake Chemical vs. JB Hunt Transport | Westlake Chemical vs. Coor Service Management | Westlake Chemical vs. Roebuck Food Group |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
Other Complementary Tools
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine |