Correlation Between Dupont De and AGRICULTBK HADR/25

Can any of the company-specific risk be diversified away by investing in both Dupont De and AGRICULTBK HADR/25 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 AGRICULTBK HADR/25 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 AGRICULTBK HADR25 YC, you can compare the effects of market volatilities on Dupont De and AGRICULTBK HADR/25 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 AGRICULTBK HADR/25. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dupont De and AGRICULTBK HADR/25.

Diversification Opportunities for Dupont De and AGRICULTBK HADR/25

0.28

Correlation Coefficient

Dupont De  AGRICULTBK HADR/25

Modest diversification

The 3 months correlation between Dupont and AGRICULTBK is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Dupont De Nemours and AGRICULTBK HADR25 YC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AGRICULTBK HADR/25 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 AGRICULTBK HADR/25. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AGRICULTBK HADR/25 has no effect on the direction of Dupont De i.e., Dupont De and AGRICULTBK HADR/25 go up and down completely randomly.

Pair Corralation between Dupont De and AGRICULTBK HADR/25

Allowing for the 90-day total investment horizon Dupont De is expected to generate 62.15 times less return on investment than AGRICULTBK HADR/25. But when comparing it to its historical volatility, Dupont De Nemours is 1.12 times less risky than AGRICULTBK HADR/25. It trades about 0.0 of its potential returns per unit of risk. AGRICULTBK HADR25 YC is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest  1,278  in AGRICULTBK HADR25 YC on December 26, 2024 and sell it today you would earn a total of  162.00  from holding AGRICULTBK HADR25 YC or generate 12.68% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.36%
Values	Daily Returns

Dupont De Nemours  vs.  AGRICULTBK HADR25 YC

Dupont De Nemours

Risk-Adjusted Performance

Very Weak

Over the last 90 days Dupont De Nemours has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound fundamental indicators, Dupont De is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.

AGRICULTBK HADR/25

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in AGRICULTBK HADR25 YC are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, AGRICULTBK HADR/25 reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Dupont De and AGRICULTBK HADR/25

The main advantage of trading using opposite Dupont De and AGRICULTBK HADR/25 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dupont De position performs unexpectedly, AGRICULTBK HADR/25 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 AGRICULTBK HADR/25 will offset losses from the drop in AGRICULTBK HADR/25's long position.

The idea behind Dupont De Nemours and AGRICULTBK HADR25 YC 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.