Correlation Between Dupont De and Inverse Nasdaq-100

Can any of the company-specific risk be diversified away by investing in both Dupont De and Inverse Nasdaq-100 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 Inverse Nasdaq-100 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 Inverse Nasdaq 100 Strategy, you can compare the effects of market volatilities on Dupont De and Inverse Nasdaq-100 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 Inverse Nasdaq-100. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dupont De and Inverse Nasdaq-100.

Diversification Opportunities for Dupont De and Inverse Nasdaq-100

-0.85

Correlation Coefficient

Dupont De  Inverse Nasdaq-100

Pay attention - limited upside

The 3 months correlation between Dupont and Inverse is -0.85. Overlapping area represents the amount of risk that can be diversified away by holding Dupont De Nemours and Inverse Nasdaq 100 Strategy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inverse Nasdaq 100 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 Inverse Nasdaq-100. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inverse Nasdaq 100 has no effect on the direction of Dupont De i.e., Dupont De and Inverse Nasdaq-100 go up and down completely randomly.

Pair Corralation between Dupont De and Inverse Nasdaq-100

Allowing for the 90-day total investment horizon Dupont De Nemours is expected to generate 1.91 times more return on investment than Inverse Nasdaq-100. However, Dupont De is 1.91 times more volatile than Inverse Nasdaq 100 Strategy. It trades about 0.16 of its potential returns per unit of risk. Inverse Nasdaq 100 Strategy is currently generating about -0.3 per unit of risk. If you would invest  6,530  in Dupont De Nemours on April 25, 2025 and sell it today you would earn a total of  1,128  from holding Dupont De Nemours or generate 17.27% return on investment over 90 days.

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

Dupont De Nemours  vs.  Inverse Nasdaq 100 Strategy

Dupont De Nemours

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Dupont De Nemours are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of rather conflicting fundamental indicators, Dupont De exhibited solid returns over the last few months and may actually be approaching a breakup point.

Inverse Nasdaq 100

Risk-Adjusted Performance

Very Weak

Over the last 90 days Inverse Nasdaq 100 Strategy 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 August 2025. The current disturbance may also be a sign of long term up-swing for the fund investors.

Pair Trading with Dupont De and Inverse Nasdaq-100

The main advantage of trading using opposite Dupont De and Inverse Nasdaq-100 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dupont De position performs unexpectedly, Inverse Nasdaq-100 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 Inverse Nasdaq-100 will offset losses from the drop in Inverse Nasdaq-100's long position.

The idea behind Dupont De Nemours and Inverse Nasdaq 100 Strategy 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .