Correlation Between LyondellBasell Industries and Avient Corp
Can any of the company-specific risk be diversified away by investing in both LyondellBasell Industries and Avient Corp 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 LyondellBasell Industries and Avient Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between LyondellBasell Industries NV and Avient Corp, you can compare the effects of market volatilities on LyondellBasell Industries and Avient Corp 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 LyondellBasell Industries with a short position of Avient Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of LyondellBasell Industries and Avient Corp.
Diversification Opportunities for LyondellBasell Industries and Avient Corp
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between LyondellBasell and Avient is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding LyondellBasell Industries NV and Avient Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Avient Corp and LyondellBasell Industries 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 LyondellBasell Industries NV are associated (or correlated) with Avient Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Avient Corp has no effect on the direction of LyondellBasell Industries i.e., LyondellBasell Industries and Avient Corp go up and down completely randomly.
Pair Corralation between LyondellBasell Industries and Avient Corp
Considering the 90-day investment horizon LyondellBasell Industries NV is expected to under-perform the Avient Corp. In addition to that, LyondellBasell Industries is 1.26 times more volatile than Avient Corp. It trades about -0.03 of its total potential returns per unit of risk. Avient Corp is currently generating about 0.02 per unit of volatility. If you would invest 3,729 in Avient Corp on June 10, 2025 and sell it today you would earn a total of 22.00 from holding Avient Corp or generate 0.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
LyondellBasell Industries NV vs. Avient Corp
Performance |
| Timeline |
| LyondellBasell Industries |
| Avient Corp |
LyondellBasell Industries and Avient Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LyondellBasell Industries and Avient Corp
The main advantage of trading using opposite LyondellBasell Industries and Avient Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LyondellBasell Industries position performs unexpectedly, Avient Corp 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 Avient Corp will offset losses from the drop in Avient Corp's long position.| LyondellBasell Industries vs. International Flavors Fragrances | LyondellBasell Industries vs. Cabot | LyondellBasell Industries vs. Westlake Chemical | LyondellBasell Industries vs. Air Products and |
| Avient Corp vs. Core Molding Technologies | Avient Corp vs. Neo Performance Materials | Avient Corp vs. SPAR Group | Avient Corp vs. Avalon Holdings |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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