Correlation Between Dupont De and GS Retail

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Can any of the company-specific risk be diversified away by investing in both Dupont De and GS Retail 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 Dupont De and GS Retail into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dupont De Nemours and GS Retail Co, you can compare the effects of market volatilities on Dupont De and GS Retail 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 Dupont De with a short position of GS Retail. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dupont De and GS Retail.

Diversification Opportunities for Dupont De and GS Retail

Dupont007070Diversified AwayDupont007070Diversified Away100%
0.61
  Correlation Coefficient

Poor diversification

The 3 months correlation between Dupont and 007070 is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Dupont De Nemours and GS Retail Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GS Retail and Dupont De 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 Dupont De Nemours are associated (or correlated) with GS Retail. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GS Retail has no effect on the direction of Dupont De i.e., Dupont De and GS Retail go up and down completely randomly.

Pair Corralation between Dupont De and GS Retail

Allowing for the 90-day total investment horizon Dupont De Nemours is expected to generate 0.87 times more return on investment than GS Retail. However, Dupont De Nemours is 1.15 times less risky than GS Retail. It trades about 0.1 of its potential returns per unit of risk. GS Retail Co is currently generating about -0.54 per unit of risk. If you would invest  7,526  in Dupont De Nemours on November 5, 2024 and sell it today you would earn a total of  154.00  from holding Dupont De Nemours or generate 2.05% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy89.47%
ValuesDaily Returns

Dupont De Nemours  vs.  GS Retail Co

 Performance 
JavaScript chart by amCharts 3.21.15NovDec2025 -20-15-10-505
JavaScript chart by amCharts 3.21.15DD 007070
       Timeline  
Dupont De Nemours 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Dupont De Nemours has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unfluctuating performance, the Stock's fundamental indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.
JavaScript chart by amCharts 3.21.15DecJanJanFeb7476788082848688
GS Retail 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days GS Retail Co has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in March 2025. The current disturbance may also be a sign of long term up-swing for the company investors.
JavaScript chart by amCharts 3.21.15NovDecJanDecJanFeb15,00016,00017,00018,00019,00020,00021,000

Dupont De and GS Retail Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-2.08-1.59-1.1-0.61-0.120.310.81.291.782.27 0.050.100.150.200.25
JavaScript chart by amCharts 3.21.15DD 007070
       Returns  

Pair Trading with Dupont De and GS Retail

The main advantage of trading using opposite Dupont De and GS Retail positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dupont De position performs unexpectedly, GS Retail 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 GS Retail will offset losses from the drop in GS Retail's long position.
The idea behind Dupont De Nemours and GS Retail Co 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..

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