Correlation Between Dupont De and Aiptek International
Can any of the company-specific risk be diversified away by investing in both Dupont De and Aiptek International 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 Aiptek International 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 Aiptek International, you can compare the effects of market volatilities on Dupont De and Aiptek International 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 Aiptek International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dupont De and Aiptek International.
Diversification Opportunities for Dupont De and Aiptek International
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Dupont and Aiptek is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Dupont De Nemours and Aiptek International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aiptek International 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 Aiptek International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aiptek International has no effect on the direction of Dupont De i.e., Dupont De and Aiptek International go up and down completely randomly.
Pair Corralation between Dupont De and Aiptek International
Allowing for the 90-day total investment horizon Dupont De is expected to generate 3.87 times less return on investment than Aiptek International. But when comparing it to its historical volatility, Dupont De Nemours is 1.34 times less risky than Aiptek International. It trades about 0.03 of its potential returns per unit of risk. Aiptek International is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 1,565 in Aiptek International on August 31, 2024 and sell it today you would earn a total of 55.00 from holding Aiptek International or generate 3.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dupont De Nemours vs. Aiptek International
Performance |
| Timeline |
| Dupont De Nemours |
| Aiptek International |
Dupont De and Aiptek International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dupont De and Aiptek International
The main advantage of trading using opposite Dupont De and Aiptek International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dupont De position performs unexpectedly, Aiptek International 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 Aiptek International will offset losses from the drop in Aiptek International's long position.| Dupont De vs. Eastman Chemical | Dupont De vs. Linde plc Ordinary | Dupont De vs. Ecolab Inc | Dupont De vs. Sherwin Williams Co |
| Aiptek International vs. Chaintech Technology Corp | Aiptek International vs. AVerMedia Technologies | Aiptek International vs. Avision | Aiptek International vs. Clevo Co |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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