Correlation Between Dupont De and Stampede Drilling
Can any of the company-specific risk be diversified away by investing in both Dupont De and Stampede Drilling 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 Stampede Drilling 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 Stampede Drilling, you can compare the effects of market volatilities on Dupont De and Stampede Drilling 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 Stampede Drilling. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dupont De and Stampede Drilling.
Diversification Opportunities for Dupont De and Stampede Drilling
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Dupont and Stampede is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Dupont De Nemours and Stampede Drilling in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stampede Drilling 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 Stampede Drilling. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stampede Drilling has no effect on the direction of Dupont De i.e., Dupont De and Stampede Drilling go up and down completely randomly.
Pair Corralation between Dupont De and Stampede Drilling
Allowing for the 90-day total investment horizon Dupont De Nemours is expected to generate 0.53 times more return on investment than Stampede Drilling. However, Dupont De Nemours is 1.88 times less risky than Stampede Drilling. It trades about 0.01 of its potential returns per unit of risk. Stampede Drilling is currently generating about -0.13 per unit of risk. If you would invest 8,330 in Dupont De Nemours on August 26, 2024 and sell it today you would earn a total of 2.00 from holding Dupont De Nemours or generate 0.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dupont De Nemours vs. Stampede Drilling
Performance |
| Timeline |
| Dupont De Nemours |
| Stampede Drilling |
Dupont De and Stampede Drilling Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dupont De and Stampede Drilling
The main advantage of trading using opposite Dupont De and Stampede Drilling positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dupont De position performs unexpectedly, Stampede Drilling 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 Stampede Drilling will offset losses from the drop in Stampede Drilling's long position.| Dupont De vs. Olin Corporation | Dupont De vs. Cabot | Dupont De vs. Kronos Worldwide | Dupont De vs. LyondellBasell Industries NV |
| Stampede Drilling vs. STEP Energy Services | Stampede Drilling vs. Southern Energy Corp | Stampede Drilling vs. PHX Energy Services |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
Other Complementary Tools
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Equity Valuation Check real value of public entities based on technical and fundamental data |