Correlation Between Dupont De and EXPAND
Can any of the company-specific risk be diversified away by investing in both Dupont De and EXPAND 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 EXPAND 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 EXPAND, you can compare the effects of market volatilities on Dupont De and EXPAND 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 EXPAND. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dupont De and EXPAND.
Diversification Opportunities for Dupont De and EXPAND
Good diversification
The 3 months correlation between Dupont and EXPAND is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Dupont De Nemours and EXPAND in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EXPAND 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 EXPAND. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EXPAND has no effect on the direction of Dupont De i.e., Dupont De and EXPAND go up and down completely randomly.
Pair Corralation between Dupont De and EXPAND
Allowing for the 90-day total investment horizon Dupont De is expected to generate 86.87 times less return on investment than EXPAND. But when comparing it to its historical volatility, Dupont De Nemours is 11.88 times less risky than EXPAND. It trades about 0.02 of its potential returns per unit of risk. EXPAND is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 0.01 in EXPAND on August 30, 2024 and sell it today you would earn a total of 0.00 from holding EXPAND or generate 43.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dupont De Nemours vs. EXPAND
Performance |
| Timeline |
| Dupont De Nemours |
| EXPAND |
Dupont De and EXPAND Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dupont De and EXPAND
The main advantage of trading using opposite Dupont De and EXPAND positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dupont De position performs unexpectedly, EXPAND 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 EXPAND will offset losses from the drop in EXPAND's long position.| Dupont De vs. Olin Corporation | Dupont De vs. Cabot | Dupont De vs. Kronos Worldwide | Dupont De vs. LyondellBasell Industries NV |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
Other Complementary Tools
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm |