Correlation Between Beijing Lier and Dow Jones
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By analyzing existing cross correlation between Beijing Lier High and Dow Jones Industrial, you can compare the effects of market volatilities on Beijing Lier 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 Beijing Lier with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beijing Lier and Dow Jones.
Diversification Opportunities for Beijing Lier and Dow Jones
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Beijing and Dow is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Beijing Lier High 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 Beijing Lier 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 Beijing Lier High 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 Beijing Lier i.e., Beijing Lier and Dow Jones go up and down completely randomly.
Pair Corralation between Beijing Lier and Dow Jones
Assuming the 90 days trading horizon Beijing Lier High is expected to generate 3.87 times more return on investment than Dow Jones. However, Beijing Lier is 3.87 times more volatile than Dow Jones Industrial. It trades about 0.06 of its potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.12 per unit of risk. If you would invest 366.00 in Beijing Lier High on September 4, 2024 and sell it today you would earn a total of 114.00 from holding Beijing Lier High or generate 31.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 96.34% |
| Values | Daily Returns |
Beijing Lier High vs. Dow Jones Industrial
Performance |
| Timeline |
Beijing Lier and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
Beijing Lier High
Pair trading matchups for Beijing Lier
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with Beijing Lier and Dow Jones
The main advantage of trading using opposite Beijing Lier and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beijing Lier 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.| Beijing Lier vs. Shanghai Action Education | Beijing Lier vs. Chinese Universe Publishing | Beijing Lier vs. Heilongjiang Publishing Media | Beijing Lier vs. Shanghai Metersbonwe FashionAccessories |
| Dow Jones vs. Gentex | Dow Jones vs. American Axle Manufacturing | Dow Jones vs. Pearson PLC ADR | Dow Jones vs. Marine Products |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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