Correlation Between Dupont De and Shin Kong
Can any of the company-specific risk be diversified away by investing in both Dupont De and Shin Kong 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 Shin Kong 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 Shin Kong Financial, you can compare the effects of market volatilities on Dupont De and Shin Kong 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 Shin Kong. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dupont De and Shin Kong.
Diversification Opportunities for Dupont De and Shin Kong
Very good diversification
The 3 months correlation between Dupont and Shin is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Dupont De Nemours and Shin Kong Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shin Kong Financial 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 Shin Kong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shin Kong Financial has no effect on the direction of Dupont De i.e., Dupont De and Shin Kong go up and down completely randomly.
Pair Corralation between Dupont De and Shin Kong
Allowing for the 90-day total investment horizon Dupont De is expected to generate 3.5 times less return on investment than Shin Kong. In addition to that, Dupont De is 2.64 times more volatile than Shin Kong Financial. It trades about 0.03 of its total potential returns per unit of risk. Shin Kong Financial is currently generating about 0.24 per unit of volatility. If you would invest 1,140 in Shin Kong Financial on August 28, 2024 and sell it today you would earn a total of 35.00 from holding Shin Kong Financial or generate 3.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dupont De Nemours vs. Shin Kong Financial
Performance |
| Timeline |
| Dupont De Nemours |
| Shin Kong Financial |
Dupont De and Shin Kong Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dupont De and Shin Kong
The main advantage of trading using opposite Dupont De and Shin Kong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dupont De position performs unexpectedly, Shin Kong 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 Shin Kong will offset losses from the drop in Shin Kong's long position.| Dupont De vs. Olin Corporation | Dupont De vs. Cabot | Dupont De vs. Kronos Worldwide | Dupont De vs. LyondellBasell Industries NV |
| Shin Kong vs. Cathay Financial Holding | Shin Kong vs. Taishin Financial Holding | Shin Kong vs. Fubon Financial Holding | Shin Kong vs. CTBC Financial Holding |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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