Correlation Between Dupont De and American Shipping
Can any of the company-specific risk be diversified away by investing in both Dupont De and American Shipping 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 American Shipping 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 American Shipping, you can compare the effects of market volatilities on Dupont De and American Shipping 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 American Shipping. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dupont De and American Shipping.
Diversification Opportunities for Dupont De and American Shipping
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between Dupont and American is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Dupont De Nemours and American Shipping in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Shipping 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 American Shipping. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Shipping has no effect on the direction of Dupont De i.e., Dupont De and American Shipping go up and down completely randomly.
Pair Corralation between Dupont De and American Shipping
Allowing for the 90-day total investment horizon Dupont De Nemours is expected to generate 1.14 times more return on investment than American Shipping. However, Dupont De is 1.14 times more volatile than American Shipping. It trades about 0.01 of its potential returns per unit of risk. American Shipping is currently generating about -0.25 per unit of risk. If you would invest 8,330 in Dupont De Nemours on August 26, 2024 and sell it today you would earn a total of 2.00 from holding Dupont De Nemours or generate 0.02% 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. American Shipping
Performance |
| Timeline |
| Dupont De Nemours |
| American Shipping |
Dupont De and American Shipping Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dupont De and American Shipping
The main advantage of trading using opposite Dupont De and American Shipping positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dupont De position performs unexpectedly, American Shipping 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 American Shipping will offset losses from the drop in American Shipping's long position.| Dupont De vs. Olin Corporation | Dupont De vs. Cabot | Dupont De vs. Kronos Worldwide | Dupont De vs. LyondellBasell Industries NV |
| American Shipping vs. Western Bulk Chartering | American Shipping vs. AP Moeller | American Shipping vs. AP Mller | American Shipping vs. Pacific Basin Shipping |
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.
Other Complementary Tools
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Commodity Directory Find actively traded commodities issued by global exchanges |