Correlation Between Dupont De and China Mengniu
Can any of the company-specific risk be diversified away by investing in both Dupont De and China Mengniu 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 Mengniu 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 Mengniu Dairy, you can compare the effects of market volatilities on Dupont De and China Mengniu 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 Mengniu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dupont De and China Mengniu.
Diversification Opportunities for Dupont De and China Mengniu
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Dupont and China is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Dupont De Nemours and China Mengniu Dairy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Mengniu Dairy 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 Mengniu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Mengniu Dairy has no effect on the direction of Dupont De i.e., Dupont De and China Mengniu go up and down completely randomly.
Pair Corralation between Dupont De and China Mengniu
If you would invest 8,344 in Dupont De Nemours on August 30, 2024 and sell it today you would earn a total of 46.00 from holding Dupont De Nemours or generate 0.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dupont De Nemours vs. China Mengniu Dairy
Performance |
| Timeline |
| Dupont De Nemours |
| China Mengniu Dairy |
Dupont De and China Mengniu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dupont De and China Mengniu
The main advantage of trading using opposite Dupont De and China Mengniu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dupont De position performs unexpectedly, China Mengniu 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 Mengniu will offset losses from the drop in China Mengniu's long position.| Dupont De vs. Olin Corporation | Dupont De vs. Cabot | Dupont De vs. Kronos Worldwide | Dupont De vs. LyondellBasell Industries NV |
| China Mengniu vs. Seneca Foods Corp | China Mengniu vs. Associated British Foods | China Mengniu vs. Natures Sunshine Products | China Mengniu vs. Marfrig Global Foods |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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