Correlation Between SEKISUI CHEMICAL and BLUELINX HLDGS

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

By analyzing existing cross correlation between SEKISUI CHEMICAL and BLUELINX HLDGS DL 01, you can compare the effects of market volatilities on SEKISUI CHEMICAL and BLUELINX HLDGS 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 SEKISUI CHEMICAL with a short position of BLUELINX HLDGS. Check out your portfolio center. Please also check ongoing floating volatility patterns of SEKISUI CHEMICAL and BLUELINX HLDGS.

Diversification Opportunities for SEKISUI CHEMICAL and BLUELINX HLDGS

0.0

Correlation Coefficient

SEKISUI CHEMICAL  BLUELINX HLDGS

Pay attention - limited upside

The 3 months correlation between SEKISUI and BLUELINX is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding SEKISUI CHEMICAL and BLUELINX HLDGS DL 01 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BLUELINX HLDGS DL and SEKISUI 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 SEKISUI CHEMICAL are associated (or correlated) with BLUELINX HLDGS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BLUELINX HLDGS DL has no effect on the direction of SEKISUI CHEMICAL i.e., SEKISUI CHEMICAL and BLUELINX HLDGS go up and down completely randomly.

Pair Corralation between SEKISUI CHEMICAL and BLUELINX HLDGS

If you would invest  1,290  in SEKISUI CHEMICAL on October 24, 2024 and sell it today you would earn a total of  200.00  from holding SEKISUI CHEMICAL or generate 15.5% return on investment over 90 days.

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

SEKISUI CHEMICAL  vs.  BLUELINX HLDGS DL 01

SEKISUI CHEMICAL

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in SEKISUI CHEMICAL are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile forward indicators, SEKISUI CHEMICAL exhibited solid returns over the last few months and may actually be approaching a breakup point.

BLUELINX HLDGS DL

Risk-Adjusted Performance

0 of 100

Modest

Over the last 90 days BLUELINX HLDGS DL 01 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable technical and fundamental indicators, BLUELINX HLDGS is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with SEKISUI CHEMICAL and BLUELINX HLDGS

The main advantage of trading using opposite SEKISUI CHEMICAL and BLUELINX HLDGS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SEKISUI CHEMICAL position performs unexpectedly, BLUELINX HLDGS 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 BLUELINX HLDGS will offset losses from the drop in BLUELINX HLDGS's long position.

The idea behind SEKISUI CHEMICAL and BLUELINX HLDGS DL 01 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.