Correlation Between Dupont De and General Mills
Can any of the company-specific risk be diversified away by investing in both Dupont De and General Mills 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 General Mills 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 General Mills, you can compare the effects of market volatilities on Dupont De and General Mills 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 General Mills. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dupont De and General Mills.
Diversification Opportunities for Dupont De and General Mills
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between Dupont and General is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Dupont De Nemours and General Mills in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on General Mills 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 General Mills. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of General Mills has no effect on the direction of Dupont De i.e., Dupont De and General Mills go up and down completely randomly.
Pair Corralation between Dupont De and General Mills
Allowing for the 90-day total investment horizon Dupont De Nemours is expected to generate 1.26 times more return on investment than General Mills. However, Dupont De is 1.26 times more volatile than General Mills. It trades about 0.04 of its potential returns per unit of risk. General Mills is currently generating about -0.03 per unit of risk. If you would invest 6,747 in Dupont De Nemours on August 29, 2024 and sell it today you would earn a total of 1,643 from holding Dupont De Nemours or generate 24.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 98.22% |
| Values | Daily Returns |
Dupont De Nemours vs. General Mills
Performance |
| Timeline |
| Dupont De Nemours |
| General Mills |
Dupont De and General Mills Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dupont De and General Mills
The main advantage of trading using opposite Dupont De and General Mills positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dupont De position performs unexpectedly, General Mills 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 General Mills will offset losses from the drop in General Mills' long position.| Dupont De vs. Direxion Daily FTSE | Dupont De vs. Collegium Pharmaceutical | Dupont De vs. KKR Co LP | Dupont De vs. iShares Dividend and |
| General Mills vs. Superior Plus Corp | General Mills vs. SIVERS SEMICONDUCTORS AB | General Mills vs. Talanx AG | General Mills vs. 2G ENERGY |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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