Correlation Between Dupont De and Nordea Bank
Can any of the company-specific risk be diversified away by investing in both Dupont De and Nordea Bank 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 Nordea Bank 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 Nordea Bank Abp, you can compare the effects of market volatilities on Dupont De and Nordea Bank 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 Nordea Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dupont De and Nordea Bank.
Diversification Opportunities for Dupont De and Nordea Bank
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Dupont and Nordea is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Dupont De Nemours and Nordea Bank Abp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nordea Bank Abp 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 Nordea Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nordea Bank Abp has no effect on the direction of Dupont De i.e., Dupont De and Nordea Bank go up and down completely randomly.
Pair Corralation between Dupont De and Nordea Bank
Allowing for the 90-day total investment horizon Dupont De Nemours is expected to under-perform the Nordea Bank. But the stock apears to be less risky and, when comparing its historical volatility, Dupont De Nemours is 1.37 times less risky than Nordea Bank. The stock trades about -0.55 of its potential returns per unit of risk. The Nordea Bank Abp is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 12,450 in Nordea Bank Abp on October 11, 2024 and sell it today you would earn a total of 93.00 from holding Nordea Bank Abp or generate 0.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Dupont De Nemours vs. Nordea Bank Abp
Performance |
| Timeline |
| Dupont De Nemours |
| Nordea Bank Abp |
Dupont De and Nordea Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dupont De and Nordea Bank
The main advantage of trading using opposite Dupont De and Nordea Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dupont De position performs unexpectedly, Nordea Bank 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 Nordea Bank will offset losses from the drop in Nordea Bank's long position.| Dupont De vs. Eastman Chemical | Dupont De vs. Olin Corporation | Dupont De vs. Cabot | Dupont De vs. Kronos Worldwide |
| Nordea Bank vs. Intermediate Capital Group | Nordea Bank vs. Zoom Video Communications | Nordea Bank vs. One Media iP | Nordea Bank vs. Zinc Media Group |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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