Correlation Between Dupont De and Lazard
Can any of the company-specific risk be diversified away by investing in both Dupont De and Lazard 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 Lazard 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 Lazard, you can compare the effects of market volatilities on Dupont De and Lazard 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 Lazard. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dupont De and Lazard.
Diversification Opportunities for Dupont De and Lazard
Average diversification
The 3 months correlation between Dupont and Lazard is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Dupont De Nemours and Lazard in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lazard 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 Lazard. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lazard has no effect on the direction of Dupont De i.e., Dupont De and Lazard go up and down completely randomly.
Pair Corralation between Dupont De and Lazard
Allowing for the 90-day total investment horizon Dupont De is expected to generate 19.02 times less return on investment than Lazard. But when comparing it to its historical volatility, Dupont De Nemours is 2.37 times less risky than Lazard. It trades about 0.03 of its potential returns per unit of risk. Lazard is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 5,123 in Lazard on August 28, 2024 and sell it today you would earn a total of 843.00 from holding Lazard or generate 16.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dupont De Nemours vs. Lazard
Performance |
| Timeline |
| Dupont De Nemours |
| Lazard |
Dupont De and Lazard Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dupont De and Lazard
The main advantage of trading using opposite Dupont De and Lazard positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dupont De position performs unexpectedly, Lazard 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 Lazard will offset losses from the drop in Lazard's long position.| Dupont De vs. Olin Corporation | Dupont De vs. Cabot | Dupont De vs. Kronos Worldwide | Dupont De vs. LyondellBasell Industries NV |
| Lazard vs. PJT Partners | Lazard vs. Moelis Co | Lazard vs. Houlihan Lokey | Lazard vs. Piper Sandler Companies |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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