Correlation Between Dupont De and CATERPILLAR
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By analyzing existing cross correlation between Dupont De Nemours and CATERPILLAR FINANCIAL SERVICES, you can compare the effects of market volatilities on Dupont De and CATERPILLAR 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 CATERPILLAR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dupont De and CATERPILLAR.
Diversification Opportunities for Dupont De and CATERPILLAR
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Dupont and CATERPILLAR is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Dupont De Nemours and CATERPILLAR FINANCIAL SERVICES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CATERPILLAR FINANCIAL 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 CATERPILLAR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CATERPILLAR FINANCIAL has no effect on the direction of Dupont De i.e., Dupont De and CATERPILLAR go up and down completely randomly.
Pair Corralation between Dupont De and CATERPILLAR
Allowing for the 90-day total investment horizon Dupont De Nemours is expected to generate 5.97 times more return on investment than CATERPILLAR. However, Dupont De is 5.97 times more volatile than CATERPILLAR FINANCIAL SERVICES. It trades about 0.03 of its potential returns per unit of risk. CATERPILLAR FINANCIAL SERVICES is currently generating about 0.03 per unit of risk. If you would invest 7,440 in Dupont De Nemours on September 4, 2024 and sell it today you would earn a total of 932.00 from holding Dupont De Nemours or generate 12.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.17% |
| Values | Daily Returns |
Dupont De Nemours vs. CATERPILLAR FINANCIAL SERVICES
Performance |
| Timeline |
| Dupont De Nemours |
| CATERPILLAR FINANCIAL |
Dupont De and CATERPILLAR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dupont De and CATERPILLAR
The main advantage of trading using opposite Dupont De and CATERPILLAR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dupont De position performs unexpectedly, CATERPILLAR 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 CATERPILLAR will offset losses from the drop in CATERPILLAR's long position.| Dupont De vs. Olin Corporation | Dupont De vs. Cabot | Dupont De vs. Kronos Worldwide | Dupont De vs. LyondellBasell Industries NV |
| CATERPILLAR vs. Southwest Gas Holdings | CATERPILLAR vs. Algoma Steel Group | CATERPILLAR vs. Allegheny Technologies Incorporated | CATERPILLAR vs. NRG Energy |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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