Correlation Between Dupont Denemours and TuanChe

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Can any of the company-specific risk be diversified away by investing in both Dupont Denemours and TuanChe 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 Denemours and TuanChe into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dupont Denemours and TuanChe Limited, you can compare the effects of market volatilities on Dupont Denemours and TuanChe 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 Denemours with a short position of TuanChe. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dupont Denemours and TuanChe.

Diversification Opportunities for Dupont Denemours and TuanChe

0.12
  Correlation Coefficient

Average diversification

The 3 months correlation between Dupont and TuanChe is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Dupont Denemours and TuanChe Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TuanChe Limited and Dupont Denemours 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 Denemours are associated (or correlated) with TuanChe. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TuanChe Limited has no effect on the direction of Dupont Denemours i.e., Dupont Denemours and TuanChe go up and down completely randomly.

Pair Corralation between Dupont Denemours and TuanChe

Allowing for the 90-day total investment horizon Dupont Denemours is expected to under-perform the TuanChe. But the stock apears to be less risky and, when comparing its historical volatility, Dupont Denemours is 2.99 times less risky than TuanChe. The stock trades about -0.04 of its potential returns per unit of risk. The TuanChe Limited is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest  300.00  in TuanChe Limited on March 27, 2022 and sell it today you would lose (89.00)  from holding TuanChe Limited or give up 29.67% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Dupont Denemours  vs.  TuanChe Limited

 Performance (%) 
      Timeline 
Dupont Denemours 
Dupont Performance
0 of 100
Over the last 90 days Dupont Denemours has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's fundamental indicators remain rather sound which may send shares a bit higher in July 2022. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Structure and Payout Changes

Forward Annual Dividend Yield
0.0238
Payout Ratio
0.35
Last Split Factor
4725:10000
Forward Annual Dividend Rate
1.32
Dividend Date
2022-06-15
Ex Dividend Date
2022-05-27
Last Split Date
2019-06-03

Dupont Price Channel

TuanChe Limited 
TuanChe Performance
0 of 100
Over the last 90 days TuanChe Limited has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong fundamental indicators, TuanChe is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Structure and Payout Changes

Last Split Factor
1:4
Dividend Date
2020-10-22
Last Split Date
2020-10-22

TuanChe Price Channel

Dupont Denemours and TuanChe Volatility Contrast

 Predicted Return Density 
      Returns 

Pair Trading with Dupont Denemours and TuanChe

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

TuanChe Limited

Pair trading matchups for TuanChe

Check out your portfolio center. 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.

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