Correlation Between Dupont De and ASM International
Can any of the company-specific risk be diversified away by investing in both Dupont De and ASM 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 ASM 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 ASM International NV, you can compare the effects of market volatilities on Dupont De and ASM 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 ASM International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dupont De and ASM International.
Diversification Opportunities for Dupont De and ASM International
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Dupont and ASM is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Dupont De Nemours and ASM International NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ASM 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 ASM International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ASM International has no effect on the direction of Dupont De i.e., Dupont De and ASM International go up and down completely randomly.
Pair Corralation between Dupont De and ASM International
Allowing for the 90-day total investment horizon Dupont De is expected to generate 2.41 times less return on investment than ASM International. But when comparing it to its historical volatility, Dupont De Nemours is 4.11 times less risky than ASM International. It trades about 0.1 of its potential returns per unit of risk. ASM International NV is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 57,978 in ASM International NV on November 5, 2024 and sell it today you would earn a total of 1,892 from holding ASM International NV or generate 3.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dupont De Nemours vs. ASM International NV
Performance |
| Timeline |
| Dupont De Nemours |
| ASM International |
Dupont De and ASM International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dupont De and ASM International
The main advantage of trading using opposite Dupont De and ASM International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dupont De position performs unexpectedly, ASM 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 ASM International will offset losses from the drop in ASM International's long position.| Dupont De vs. Eastman Chemical | Dupont De vs. Olin Corporation | Dupont De vs. Cabot | Dupont De vs. Kronos Worldwide |
| ASM International vs. Lasertec | ASM International vs. Tokyo Electron | ASM International vs. Tokyo Electron Ltd | ASM International vs. BE Semiconductor Industries |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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