Correlation Between ANT and EI Du

Can any of the company-specific risk be diversified away by investing in both ANT and EI Du 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 ANT and EI Du into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between ANT and EI du Pont, you can compare the effects of market volatilities on ANT and EI Du 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 ANT with a short position of EI Du. Check out your portfolio center. Please also check ongoing floating volatility patterns of ANT and EI Du.

Diversification Opportunities for ANT and EI Du

-0.07

Correlation Coefficient

ANT  EI Du

Good diversification

The 3 months correlation between ANT and CTA-P-A is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding ANT and EI du Pont in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EI du Pont and ANT 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 ANT are associated (or correlated) with EI Du. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EI du Pont has no effect on the direction of ANT i.e., ANT and EI Du go up and down completely randomly.

Pair Corralation between ANT and EI Du

Assuming the 90 days trading horizon ANT is expected to generate 15.31 times more return on investment than EI Du. However, ANT is 15.31 times more volatile than EI du Pont. It trades about 0.08 of its potential returns per unit of risk. EI du Pont is currently generating about 0.05 per unit of risk. If you would invest  147.00  in ANT on December 21, 2024 and sell it today you would earn a total of  0.00  from holding ANT or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	65.63%
Values	Daily Returns

ANT  vs.  EI du Pont

ANT

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in ANT are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, ANT exhibited solid returns over the last few months and may actually be approaching a breakup point.

EI du Pont

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in EI du Pont are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, EI Du is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with ANT and EI Du

The main advantage of trading using opposite ANT and EI Du positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ANT position performs unexpectedly, EI Du 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 EI Du will offset losses from the drop in EI Du's long position.

The idea behind ANT and EI du Pont pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.