Correlation Between Dupont De and Saul Centers

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

Diversification Opportunities for Dupont De and Saul Centers

0.91

Correlation Coefficient

Dupont De  Saul Centers

Almost no diversification

The 3 months correlation between Dupont and Saul is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Dupont De Nemours and Saul Centers in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Saul Centers 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 Saul Centers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Saul Centers has no effect on the direction of Dupont De i.e., Dupont De and Saul Centers go up and down completely randomly.

Pair Corralation between Dupont De and Saul Centers

Allowing for the 90-day total investment horizon Dupont De Nemours is expected to generate 2.19 times more return on investment than Saul Centers. However, Dupont De is 2.19 times more volatile than Saul Centers. It trades about 0.22 of its potential returns per unit of risk. Saul Centers is currently generating about 0.09 per unit of risk. If you would invest  5,778  in Dupont De Nemours on February 4, 2025 and sell it today you would earn a total of  947.00  from holding Dupont De Nemours or generate 16.39% 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.  Saul Centers

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 latest inconsistent performance, the Stock's fundamental indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Saul Centers

Risk-Adjusted Performance

Very Weak

Over the last 90 days Saul Centers has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's technical and fundamental indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with Dupont De and Saul Centers

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

The idea behind Dupont De Nemours and Saul Centers 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.