Correlation Between Soken Chemical and Westlake Chemical
Can any of the company-specific risk be diversified away by investing in both Soken Chemical 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 Soken Chemical and Westlake Chemical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Soken Chemical Engineering and Westlake Chemical, you can compare the effects of market volatilities on Soken Chemical 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 Soken Chemical with a short position of Westlake Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Soken Chemical and Westlake Chemical.
Diversification Opportunities for Soken Chemical and Westlake Chemical
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Soken and Westlake is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Soken Chemical Engineering and Westlake Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Westlake Chemical and Soken 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 Soken Chemical Engineering 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 Soken Chemical i.e., Soken Chemical and Westlake Chemical go up and down completely randomly.
Pair Corralation between Soken Chemical and Westlake Chemical
If you would invest 1,266 in Soken Chemical Engineering on August 29, 2024 and sell it today you would earn a total of 0.00 from holding Soken Chemical Engineering or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Soken Chemical Engineering vs. Westlake Chemical
Performance |
| Timeline |
| Soken Chemical Engin |
| Westlake Chemical |
Soken Chemical and Westlake Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Soken Chemical and Westlake Chemical
The main advantage of trading using opposite Soken Chemical and Westlake Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Soken Chemical 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.| Soken Chemical vs. Linde plc | Soken Chemical vs. Superior Plus Corp | Soken Chemical vs. NMI Holdings | Soken Chemical vs. SIVERS SEMICONDUCTORS AB |
| Westlake Chemical vs. Warner Music Group | Westlake Chemical vs. Soken Chemical Engineering | Westlake Chemical vs. GEAR4MUSIC LS 10 | Westlake Chemical vs. Silicon Motion Technology |
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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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