Correlation Between Dupont De and CI Gold
Can any of the company-specific risk be diversified away by investing in both Dupont De and CI Gold 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 CI Gold 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 CI Gold Giants, you can compare the effects of market volatilities on Dupont De and CI Gold 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 CI Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dupont De and CI Gold.
Diversification Opportunities for Dupont De and CI Gold
Significant diversification
The 3 months correlation between Dupont and CGXF is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Dupont De Nemours and CI Gold Giants in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CI Gold Giants 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 CI Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CI Gold Giants has no effect on the direction of Dupont De i.e., Dupont De and CI Gold go up and down completely randomly.
Pair Corralation between Dupont De and CI Gold
Allowing for the 90-day total investment horizon Dupont De is expected to generate 5.48 times less return on investment than CI Gold. But when comparing it to its historical volatility, Dupont De Nemours is 1.22 times less risky than CI Gold. It trades about 0.02 of its potential returns per unit of risk. CI Gold Giants is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 987.00 in CI Gold Giants on November 28, 2024 and sell it today you would earn a total of 215.00 from holding CI Gold Giants or generate 21.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.46% |
| Values | Daily Returns |
Dupont De Nemours vs. CI Gold Giants
Performance |
| Timeline |
| Dupont De Nemours |
| CI Gold Giants |
Dupont De and CI Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dupont De and CI Gold
The main advantage of trading using opposite Dupont De and CI Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dupont De position performs unexpectedly, CI Gold 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 CI Gold will offset losses from the drop in CI Gold's long position.| Dupont De vs. Eastman Chemical | Dupont De vs. Olin Corporation | Dupont De vs. Cabot | Dupont De vs. Kronos Worldwide |
| CI Gold vs. First Asset Energy | CI Gold vs. First Asset Tech | CI Gold vs. Harvest Equal Weight | CI Gold vs. CI Canada Lifeco |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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