Correlation Between Univar and Westlake Chemical

Can any of the company-specific risk be diversified away by investing in both Univar 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 Univar and Westlake Chemical into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Univar Inc and Westlake Chemical Partners, you can compare the effects of market volatilities on Univar 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 Univar with a short position of Westlake Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Univar and Westlake Chemical.

Diversification Opportunities for Univar and Westlake Chemical

0.0

Correlation Coefficient

Univar  Westlake Chemical

Pay attention - limited upside

The 3 months correlation between Univar and Westlake is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Univar Inc and Westlake Chemical Partners in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Westlake Chemical and Univar 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 Univar Inc 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 Univar i.e., Univar and Westlake Chemical go up and down completely randomly.

Pair Corralation between Univar and Westlake Chemical

If you would invest (100.00) in Univar Inc on May 7, 2025 and sell it today you would earn a total of  100.00  from holding Univar Inc or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Univar Inc  vs.  Westlake Chemical Partners

Univar Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Univar Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Univar is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Westlake Chemical

Risk-Adjusted Performance

Very Weak

Over the last 90 days Westlake Chemical Partners has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable forward-looking signals, Westlake Chemical is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Univar and Westlake Chemical

The main advantage of trading using opposite Univar and Westlake Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Univar 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.

The idea behind Univar Inc and Westlake Chemical Partners pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Money Managers module to screen money managers from public funds and ETFs managed around the world.