Correlation Between Air Products and DL Industries

Can any of the company-specific risk be diversified away by investing in both Air Products and DL Industries 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 Air Products and DL Industries into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Air Products And and DL Industries, you can compare the effects of market volatilities on Air Products and DL Industries 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 Air Products with a short position of DL Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of Air Products and DL Industries.

Diversification Opportunities for Air Products and DL Industries

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Correlation Coefficient

Air Products DL Industries

Pay attention - limited upside

The 3 months correlation between Air Products and DLNDY is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Air Products And and DL Industries Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DL Industries and Air Products 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 Air Products And are associated (or correlated) with DL Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DL Industries has no effect on the direction of Air Products i.e., Air Products and DL Industries go up and down completely randomly.

Pair Corralation between Air Products and DL Industries

If you would invest  27,751  in Air Products And on December 22, 2022 and sell it today you would earn a total of  130.00  from holding Air Products And or generate 0.47% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Air Products And  vs.  DL Industries Inc

Air Products And

Air Products Performance

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Over the last 90 days Air Products And has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's basic indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

DL Industries

DLNDY Performance

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Over the last 90 days DL Industries has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong fundamental indicators, DL Industries is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Air Products and DL Industries

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

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The idea behind Air Products And and DL Industries 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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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 Equity Valuation module to check real value of public entities based on technical and fundamental data.