Correlation Between Dupont De and China CITIC
Can any of the company-specific risk be diversified away by investing in both Dupont De and China CITIC 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 China CITIC 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 China CITIC Bank, you can compare the effects of market volatilities on Dupont De and China CITIC 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 China CITIC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dupont De and China CITIC.
Diversification Opportunities for Dupont De and China CITIC
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Dupont and China is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Dupont De Nemours and China CITIC Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China CITIC Bank 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 China CITIC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China CITIC Bank has no effect on the direction of Dupont De i.e., Dupont De and China CITIC go up and down completely randomly.
Pair Corralation between Dupont De and China CITIC
If you would invest 8,327 in Dupont De Nemours on August 31, 2024 and sell it today you would earn a total of 63.00 from holding Dupont De Nemours or generate 0.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 4.55% |
| Values | Daily Returns |
Dupont De Nemours vs. China CITIC Bank
Performance |
| Timeline |
| Dupont De Nemours |
| China CITIC Bank |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Dupont De and China CITIC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dupont De and China CITIC
The main advantage of trading using opposite Dupont De and China CITIC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dupont De position performs unexpectedly, China CITIC 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 China CITIC will offset losses from the drop in China CITIC'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 |
| China CITIC vs. Postal Savings Bank | China CITIC vs. China Merchants Bank | China CITIC vs. China Merchants Bank | China CITIC vs. Community West Bancshares |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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