Correlation Between Dupont De and Siemens Healthineers
Can any of the company-specific risk be diversified away by investing in both Dupont De and Siemens Healthineers 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 Siemens Healthineers 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 Siemens Healthineers AG, you can compare the effects of market volatilities on Dupont De and Siemens Healthineers 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 Siemens Healthineers. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dupont De and Siemens Healthineers.
Diversification Opportunities for Dupont De and Siemens Healthineers
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Dupont and Siemens is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Dupont De Nemours and Siemens Healthineers AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Siemens Healthineers 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 Siemens Healthineers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Siemens Healthineers has no effect on the direction of Dupont De i.e., Dupont De and Siemens Healthineers go up and down completely randomly.
Pair Corralation between Dupont De and Siemens Healthineers
Allowing for the 90-day total investment horizon Dupont De Nemours is expected to generate 1.08 times more return on investment than Siemens Healthineers. However, Dupont De is 1.08 times more volatile than Siemens Healthineers AG. It trades about 0.03 of its potential returns per unit of risk. Siemens Healthineers AG is currently generating about 0.01 per unit of risk. If you would invest 6,814 in Dupont De Nemours on September 3, 2024 and sell it today you would earn a total of 1,558 from holding Dupont De Nemours or generate 22.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 98.02% |
| Values | Daily Returns |
Dupont De Nemours vs. Siemens Healthineers AG
Performance |
| Timeline |
| Dupont De Nemours |
| Siemens Healthineers |
Dupont De and Siemens Healthineers Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dupont De and Siemens Healthineers
The main advantage of trading using opposite Dupont De and Siemens Healthineers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dupont De position performs unexpectedly, Siemens Healthineers 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 Siemens Healthineers will offset losses from the drop in Siemens Healthineers' long position.| Dupont De vs. SPACE | Dupont De vs. Bayview Acquisition Corp | Dupont De vs. T Rowe Price | Dupont De vs. Ampleforth |
| Siemens Healthineers vs. Universal Insurance Holdings | Siemens Healthineers vs. SBI Insurance Group | Siemens Healthineers vs. Burlington Stores | Siemens Healthineers vs. REVO INSURANCE SPA |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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