Correlation Between Shenzhen Clou and Dow Jones
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By analyzing existing cross correlation between Shenzhen Clou Electronics and Dow Jones Industrial, you can compare the effects of market volatilities on Shenzhen Clou and Dow Jones 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 Shenzhen Clou with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shenzhen Clou and Dow Jones.
Diversification Opportunities for Shenzhen Clou and Dow Jones
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Shenzhen and Dow is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Shenzhen Clou Electronics and Dow Jones Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dow Jones Industrial and Shenzhen Clou 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 Shenzhen Clou Electronics are associated (or correlated) with Dow Jones. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dow Jones Industrial has no effect on the direction of Shenzhen Clou i.e., Shenzhen Clou and Dow Jones go up and down completely randomly.
Pair Corralation between Shenzhen Clou and Dow Jones
Assuming the 90 days trading horizon Shenzhen Clou is expected to generate 1.27 times less return on investment than Dow Jones. In addition to that, Shenzhen Clou is 3.68 times more volatile than Dow Jones Industrial. It trades about 0.06 of its total potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.27 per unit of volatility. If you would invest 4,238,757 in Dow Jones Industrial on August 29, 2024 and sell it today you would earn a total of 247,274 from holding Dow Jones Industrial or generate 5.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shenzhen Clou Electronics vs. Dow Jones Industrial
Performance |
| Timeline |
Shenzhen Clou and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
Shenzhen Clou Electronics
Pair trading matchups for Shenzhen Clou
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with Shenzhen Clou and Dow Jones
The main advantage of trading using opposite Shenzhen Clou and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shenzhen Clou position performs unexpectedly, Dow Jones 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 Dow Jones will offset losses from the drop in Dow Jones' long position.| Shenzhen Clou vs. Harbin Hatou Investment | Shenzhen Clou vs. Jointo Energy Investment | Shenzhen Clou vs. Xian International Medical | Shenzhen Clou vs. Cofoe Medical Technology |
| Dow Jones vs. CECO Environmental Corp | Dow Jones vs. Western Acquisition Ventures | Dow Jones vs. Tyson Foods | Dow Jones vs. Inflection Point Acquisition |
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 the Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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