Correlation Between Braskem SA and Celanese
Can any of the company-specific risk be diversified away by investing in both Braskem SA 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 Braskem SA and Celanese into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Braskem SA Class and Celanese, you can compare the effects of market volatilities on Braskem SA 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 Braskem SA with a short position of Celanese. Check out your portfolio center. Please also check ongoing floating volatility patterns of Braskem SA and Celanese.
Diversification Opportunities for Braskem SA and Celanese
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Braskem and Celanese is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Braskem SA Class and Celanese in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Celanese and Braskem SA 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 Braskem SA Class 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 Braskem SA i.e., Braskem SA and Celanese go up and down completely randomly.
Pair Corralation between Braskem SA and Celanese
Considering the 90-day investment horizon Braskem SA Class is expected to generate 0.43 times more return on investment than Celanese. However, Braskem SA Class is 2.35 times less risky than Celanese. It trades about -0.3 of its potential returns per unit of risk. Celanese is currently generating about -0.38 per unit of risk. If you would invest 632.00 in Braskem SA Class on August 28, 2024 and sell it today you would lose (99.00) from holding Braskem SA Class or give up 15.66% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Braskem SA Class vs. Celanese
Performance |
| Timeline |
| Braskem SA Class |
| Celanese |
Braskem SA and Celanese Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Braskem SA and Celanese
The main advantage of trading using opposite Braskem SA and Celanese positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Braskem SA 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.| Braskem SA vs. Huntsman | Braskem SA vs. AdvanSix | Braskem SA vs. Celanese | Braskem SA vs. Green Plains Renewable |
| Celanese vs. Tronox Holdings PLC | Celanese vs. Green Plains Renewable | Celanese vs. Lsb Industries | Celanese vs. Valhi Inc |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
Other Complementary Tools
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated |