Correlation Between Dupont De and China Shenhua
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By analyzing existing cross correlation between Dupont De Nemours and China Shenhua Energy, you can compare the effects of market volatilities on Dupont De and China Shenhua 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 China Shenhua. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dupont De and China Shenhua.
Diversification Opportunities for Dupont De and China Shenhua
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Dupont and China is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Dupont De Nemours and China Shenhua Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Shenhua Energy 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 China Shenhua. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Shenhua Energy has no effect on the direction of Dupont De i.e., Dupont De and China Shenhua go up and down completely randomly.
Pair Corralation between Dupont De and China Shenhua
Allowing for the 90-day total investment horizon Dupont De is expected to generate 1.62 times less return on investment than China Shenhua. In addition to that, Dupont De is 1.02 times more volatile than China Shenhua Energy. It trades about 0.03 of its total potential returns per unit of risk. China Shenhua Energy is currently generating about 0.06 per unit of volatility. If you would invest 2,547 in China Shenhua Energy on November 27, 2024 and sell it today you would earn a total of 1,029 from holding China Shenhua Energy or generate 40.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 96.39% |
| Values | Daily Returns |
Dupont De Nemours vs. China Shenhua Energy
Performance |
| Timeline |
| Dupont De Nemours |
| China Shenhua Energy |
Dupont De and China Shenhua Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dupont De and China Shenhua
The main advantage of trading using opposite Dupont De and China Shenhua positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dupont De position performs unexpectedly, China Shenhua 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 China Shenhua will offset losses from the drop in China Shenhua's long position.| Dupont De vs. Eastman Chemical | Dupont De vs. Olin Corporation | Dupont De vs. Cabot | Dupont De vs. Kronos Worldwide |
| China Shenhua vs. Haima Automobile Group | China Shenhua vs. CIMC Vehicles Co | China Shenhua vs. Changchun Engley Automobile | China Shenhua vs. Zhejiang Qianjiang Motorcycle |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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