Correlation Between Dupont De and Capital Growth
Can any of the company-specific risk be diversified away by investing in both Dupont De and Capital Growth 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 Capital Growth 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 Capital Growth Fund, you can compare the effects of market volatilities on Dupont De and Capital Growth 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 Capital Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dupont De and Capital Growth.
Diversification Opportunities for Dupont De and Capital Growth
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Dupont and Capital is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Dupont De Nemours and Capital Growth Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Capital Growth 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 Capital Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Capital Growth has no effect on the direction of Dupont De i.e., Dupont De and Capital Growth go up and down completely randomly.
Pair Corralation between Dupont De and Capital Growth
Allowing for the 90-day total investment horizon Dupont De Nemours is expected to generate about the same return on investment as Capital Growth Fund. However, Dupont De is 1.68 times more volatile than Capital Growth Fund. It trades about 0.02 of its potential returns per unit of risk. Capital Growth Fund is currently producing about 0.04 per unit of risk. If you would invest 1,198 in Capital Growth Fund on November 9, 2024 and sell it today you would earn a total of 115.00 from holding Capital Growth Fund or generate 9.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dupont De Nemours vs. Capital Growth Fund
Performance |
| Timeline |
| Dupont De Nemours |
| Capital Growth |
Dupont De and Capital Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dupont De and Capital Growth
The main advantage of trading using opposite Dupont De and Capital Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dupont De position performs unexpectedly, Capital Growth 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 Capital Growth will offset losses from the drop in Capital Growth's long position.| Dupont De vs. Eastman Chemical | Dupont De vs. Olin Corporation | Dupont De vs. Cabot | Dupont De vs. Kronos Worldwide |
| Capital Growth vs. Lord Abbett Diversified | Capital Growth vs. Principal Lifetime Hybrid | Capital Growth vs. Blrc Sgy Mnp | Capital Growth vs. Rbb Fund |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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