Correlation Between Dupont De and SWK Holdings
Can any of the company-specific risk be diversified away by investing in both Dupont De and SWK Holdings 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 SWK Holdings 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 SWK Holdings, you can compare the effects of market volatilities on Dupont De and SWK Holdings 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 SWK Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dupont De and SWK Holdings.
Diversification Opportunities for Dupont De and SWK Holdings
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Dupont and SWK is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Dupont De Nemours and SWK Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SWK Holdings 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 SWK Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SWK Holdings has no effect on the direction of Dupont De i.e., Dupont De and SWK Holdings go up and down completely randomly.
Pair Corralation between Dupont De and SWK Holdings
Allowing for the 90-day total investment horizon Dupont De Nemours is expected to generate 4.04 times more return on investment than SWK Holdings. However, Dupont De is 4.04 times more volatile than SWK Holdings. It trades about 0.01 of its potential returns per unit of risk. SWK Holdings is currently generating about -0.09 per unit of risk. If you would invest 8,391 in Dupont De Nemours on August 29, 2024 and sell it today you would earn a total of 7.00 from holding Dupont De Nemours or generate 0.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Dupont De Nemours vs. SWK Holdings
Performance |
| Timeline |
| Dupont De Nemours |
| SWK Holdings |
Dupont De and SWK Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dupont De and SWK Holdings
The main advantage of trading using opposite Dupont De and SWK Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dupont De position performs unexpectedly, SWK Holdings 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 SWK Holdings will offset losses from the drop in SWK Holdings' 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 |
| SWK Holdings vs. PACCAR Inc | SWK Holdings vs. Pure Cycle | SWK Holdings vs. Adient PLC | SWK Holdings vs. Kenon Holdings |
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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