Correlation Between Dupont De and SAP SE

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

Diversification Opportunities for Dupont De and SAP SE

0.37

Correlation Coefficient

Dupont De  SAP SE

Weak diversification

The 3 months correlation between Dupont and SAP is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Dupont De Nemours and SAP SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SAP SE 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 SAP SE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SAP SE has no effect on the direction of Dupont De i.e., Dupont De and SAP SE go up and down completely randomly.

Pair Corralation between Dupont De and SAP SE

Allowing for the 90-day total investment horizon Dupont De Nemours is expected to generate 1.11 times more return on investment than SAP SE. However, Dupont De is 1.11 times more volatile than SAP SE. It trades about 0.09 of its potential returns per unit of risk. SAP SE is currently generating about 0.02 per unit of risk. If you would invest  6,566  in Dupont De Nemours on May 1, 2025 and sell it today you would earn a total of  654.00  from holding Dupont De Nemours or generate 9.96% return on investment over 90 days.

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

Dupont De Nemours  vs.  SAP SE

Dupont De Nemours

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Dupont De Nemours are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of rather unfluctuating fundamental indicators, Dupont De may actually be approaching a critical reversion point that can send shares even higher in August 2025.

SAP SE

Risk-Adjusted Performance

Very Weak

Compared to the overall equity markets, risk-adjusted returns on investments in SAP SE are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable technical and fundamental indicators, SAP SE is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Dupont De and SAP SE

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

The idea behind Dupont De Nemours and SAP SE 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.