Correlation Between Sichuan Yahua and Westlake Chemical

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Sichuan Yahua 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 Sichuan Yahua and Westlake Chemical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sichuan Yahua Industrial and Westlake Chemical Partners, you can compare the effects of market volatilities on Sichuan Yahua 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 Sichuan Yahua with a short position of Westlake Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sichuan Yahua and Westlake Chemical.

Diversification Opportunities for Sichuan Yahua and Westlake Chemical

-0.73
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Sichuan and Westlake is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding Sichuan Yahua Industrial and Westlake Chemical Partners in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Westlake Chemical and Sichuan Yahua 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 Sichuan Yahua Industrial 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 Sichuan Yahua i.e., Sichuan Yahua and Westlake Chemical go up and down completely randomly.

Pair Corralation between Sichuan Yahua and Westlake Chemical

Assuming the 90 days trading horizon Sichuan Yahua Industrial is expected to generate 2.89 times more return on investment than Westlake Chemical. However, Sichuan Yahua is 2.89 times more volatile than Westlake Chemical Partners. It trades about 0.22 of its potential returns per unit of risk. Westlake Chemical Partners is currently generating about -0.09 per unit of risk. If you would invest  1,508  in Sichuan Yahua Industrial on October 6, 2025 and sell it today you would earn a total of  967.00  from holding Sichuan Yahua Industrial or generate 64.12% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthWeak
Accuracy96.83%
ValuesDaily Returns

Sichuan Yahua Industrial  vs.  Westlake Chemical Partners

 Performance 
       Timeline  
Sichuan Yahua Industrial 

Risk-Adjusted Performance

Solid

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Sichuan Yahua Industrial are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Sichuan Yahua sustained solid returns over the last few months and may actually be approaching a breakup point.
Westlake Chemical 

Risk-Adjusted Performance

Weakest

 
Weak
 
Strong
Over the last 90 days Westlake Chemical Partners has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest unsteady performance, the Stock's forward-looking signals remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Sichuan Yahua and Westlake Chemical Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Sichuan Yahua and Westlake Chemical

The main advantage of trading using opposite Sichuan Yahua and Westlake Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sichuan Yahua 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 Sichuan Yahua Industrial 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.
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.

Other Complementary Tools

Stocks Directory
Find actively traded stocks across global markets
Fundamental Analysis
View fundamental data based on most recent published financial statements
Bond Analysis
Evaluate and analyze corporate bonds as a potential investment for your portfolios.
Correlation Analysis
Reduce portfolio risk simply by holding instruments which are not perfectly correlated
ETFs
Find actively traded Exchange Traded Funds (ETF) from around the world