Correlation Between INTERSHOP Communications and WESTLAKE CHEMICAL
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By analyzing existing cross correlation between INTERSHOP Communications Aktiengesellschaft and WESTLAKE CHEMICAL, you can compare the effects of market volatilities on INTERSHOP Communications 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 INTERSHOP Communications with a short position of WESTLAKE CHEMICAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of INTERSHOP Communications and WESTLAKE CHEMICAL.
Diversification Opportunities for INTERSHOP Communications and WESTLAKE CHEMICAL
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between INTERSHOP and WESTLAKE is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding INTERSHOP Communications Aktie and WESTLAKE CHEMICAL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WESTLAKE CHEMICAL and INTERSHOP Communications 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 INTERSHOP Communications Aktiengesellschaft 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 has no effect on the direction of INTERSHOP Communications i.e., INTERSHOP Communications and WESTLAKE CHEMICAL go up and down completely randomly.
Pair Corralation between INTERSHOP Communications and WESTLAKE CHEMICAL
Assuming the 90 days trading horizon INTERSHOP Communications Aktiengesellschaft is expected to under-perform the WESTLAKE CHEMICAL. But the stock apears to be less risky and, when comparing its historical volatility, INTERSHOP Communications Aktiengesellschaft is 1.02 times less risky than WESTLAKE CHEMICAL. The stock trades about -0.21 of its potential returns per unit of risk. The WESTLAKE CHEMICAL is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 12,149 in WESTLAKE CHEMICAL on August 31, 2024 and sell it today you would earn a total of 51.00 from holding WESTLAKE CHEMICAL or generate 0.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
INTERSHOP Communications Aktie vs. WESTLAKE CHEMICAL
Performance |
| Timeline |
| INTERSHOP Communications |
| WESTLAKE CHEMICAL |
INTERSHOP Communications and WESTLAKE CHEMICAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with INTERSHOP Communications and WESTLAKE CHEMICAL
The main advantage of trading using opposite INTERSHOP Communications and WESTLAKE CHEMICAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if INTERSHOP Communications 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.| INTERSHOP Communications vs. Aegean Airlines SA | INTERSHOP Communications vs. INTER CARS SA | INTERSHOP Communications vs. Grupo Carso SAB | INTERSHOP Communications vs. United Airlines Holdings |
| WESTLAKE CHEMICAL vs. SIVERS SEMICONDUCTORS AB | WESTLAKE CHEMICAL vs. Darden Restaurants | WESTLAKE CHEMICAL vs. Reliance Steel Aluminum | WESTLAKE CHEMICAL vs. Q2M Managementberatung AG |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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