Correlation Between Dupont De and Bentley Systems
Can any of the company-specific risk be diversified away by investing in both Dupont De and Bentley Systems 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 Bentley Systems 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 Bentley Systems, you can compare the effects of market volatilities on Dupont De and Bentley Systems 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 Bentley Systems. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dupont De and Bentley Systems.
Diversification Opportunities for Dupont De and Bentley Systems
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Dupont and Bentley is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Dupont De Nemours and Bentley Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bentley Systems 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 Bentley Systems. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bentley Systems has no effect on the direction of Dupont De i.e., Dupont De and Bentley Systems go up and down completely randomly.
Pair Corralation between Dupont De and Bentley Systems
Allowing for the 90-day total investment horizon Dupont De is expected to generate 2.18 times less return on investment than Bentley Systems. But when comparing it to its historical volatility, Dupont De Nemours is 1.18 times less risky than Bentley Systems. It trades about 0.03 of its potential returns per unit of risk. Bentley Systems is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 4,886 in Bentley Systems on August 28, 2024 and sell it today you would earn a total of 76.00 from holding Bentley Systems or generate 1.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dupont De Nemours vs. Bentley Systems
Performance |
| Timeline |
| Dupont De Nemours |
| Bentley Systems |
Dupont De and Bentley Systems Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dupont De and Bentley Systems
The main advantage of trading using opposite Dupont De and Bentley Systems positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dupont De position performs unexpectedly, Bentley Systems 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 Bentley Systems will offset losses from the drop in Bentley Systems' long position.| Dupont De vs. Olin Corporation | Dupont De vs. Cabot | Dupont De vs. Kronos Worldwide | Dupont De vs. LyondellBasell Industries NV |
| Bentley Systems vs. Appfolio | Bentley Systems vs. Workiva | Bentley Systems vs. Alarm Holdings | Bentley Systems vs. nCino Inc |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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