Correlation Between Dupont De and Guggenheim Styleplus

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

Diversification Opportunities for Dupont De and Guggenheim Styleplus

0.68

Correlation Coefficient

Dupont De  Guggenheim Styleplus

Poor diversification

The 3 months correlation between Dupont and Guggenheim is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Dupont De Nemours and Guggenheim Styleplus in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guggenheim Styleplus 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 Guggenheim Styleplus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guggenheim Styleplus has no effect on the direction of Dupont De i.e., Dupont De and Guggenheim Styleplus go up and down completely randomly.

Pair Corralation between Dupont De and Guggenheim Styleplus

Allowing for the 90-day total investment horizon Dupont De is expected to generate 2.43 times less return on investment than Guggenheim Styleplus. In addition to that, Dupont De is 1.33 times more volatile than Guggenheim Styleplus . It trades about 0.01 of its total potential returns per unit of risk. Guggenheim Styleplus is currently generating about 0.04 per unit of volatility. If you would invest  1,624  in Guggenheim Styleplus on October 11, 2024 and sell it today you would earn a total of  405.00  from holding Guggenheim Styleplus or generate 24.94% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Dupont De Nemours  vs.  Guggenheim Styleplus

Dupont De Nemours

Risk-Adjusted Performance

0 of 100

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 unfluctuating performance in the last few months, the Stock's fundamental indicators remain rather sound which may send shares a bit higher in February 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Guggenheim Styleplus

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Guggenheim Styleplus has generated negative risk-adjusted returns adding no value to fund investors. In spite of weak performance in the last few months, the Fund's forward indicators remain fairly strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for the fund investors.

Pair Trading with Dupont De and Guggenheim Styleplus

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

The idea behind Dupont De Nemours and Guggenheim Styleplus 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 Transaction History module to view history of all your transactions and understand their impact on performance.