Correlation Between Stepan and FLUOR
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By analyzing existing cross correlation between Stepan Company and FLUOR P NEW, you can compare the effects of market volatilities on Stepan and FLUOR 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 Stepan with a short position of FLUOR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stepan and FLUOR.
Diversification Opportunities for Stepan and FLUOR
Very good diversification
The 3 months correlation between Stepan and FLUOR is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Stepan Company and FLUOR P NEW in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FLUOR P NEW and Stepan 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 Stepan Company are associated (or correlated) with FLUOR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FLUOR P NEW has no effect on the direction of Stepan i.e., Stepan and FLUOR go up and down completely randomly.
Pair Corralation between Stepan and FLUOR
Considering the 90-day investment horizon Stepan Company is expected to generate 2.07 times more return on investment than FLUOR. However, Stepan is 2.07 times more volatile than FLUOR P NEW. It trades about 0.13 of its potential returns per unit of risk. FLUOR P NEW is currently generating about -0.17 per unit of risk. If you would invest 7,252 in Stepan Company on September 2, 2024 and sell it today you would earn a total of 438.00 from holding Stepan Company or generate 6.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Stepan Company vs. FLUOR P NEW
Performance |
| Timeline |
| Stepan Company |
| FLUOR P NEW |
Stepan and FLUOR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Stepan and FLUOR
The main advantage of trading using opposite Stepan and FLUOR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stepan position performs unexpectedly, FLUOR 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 FLUOR will offset losses from the drop in FLUOR's long position.| Stepan vs. Linde plc Ordinary | Stepan vs. Air Products and | Stepan vs. Aquagold International | Stepan vs. Thrivent High Yield |
| FLUOR vs. Stepan Company | FLUOR vs. Canlan Ice Sports | FLUOR vs. Academy Sports Outdoors | FLUOR vs. Hooker Furniture |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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