Correlation Between Xilong Chemical and Dow Jones
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By analyzing existing cross correlation between Xilong Chemical Co and Dow Jones Industrial, you can compare the effects of market volatilities on Xilong Chemical 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 Xilong Chemical with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xilong Chemical and Dow Jones.
Diversification Opportunities for Xilong Chemical and Dow Jones
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Xilong and Dow is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Xilong Chemical Co 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 Xilong Chemical 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 Xilong Chemical Co 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 Xilong Chemical i.e., Xilong Chemical and Dow Jones go up and down completely randomly.
Pair Corralation between Xilong Chemical and Dow Jones
Assuming the 90 days trading horizon Xilong Chemical Co is expected to generate 4.45 times more return on investment than Dow Jones. However, Xilong Chemical is 4.45 times more volatile than Dow Jones Industrial. It trades about 0.11 of its potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.38 per unit of risk. If you would invest 792.00 in Xilong Chemical Co on September 3, 2024 and sell it today you would earn a total of 63.00 from holding Xilong Chemical Co or generate 7.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Xilong Chemical Co vs. Dow Jones Industrial
Performance |
| Timeline |
Xilong Chemical and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
Xilong Chemical Co
Pair trading matchups for Xilong Chemical
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with Xilong Chemical and Dow Jones
The main advantage of trading using opposite Xilong Chemical and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xilong Chemical 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.| Xilong Chemical vs. Jiangsu GDK Biotechnology | Xilong Chemical vs. Guangzhou Automobile Group | Xilong Chemical vs. Huaxia Fund Management | Xilong Chemical vs. Songz Automobile Air |
| Dow Jones vs. Eastern Co | Dow Jones vs. Uber Technologies | Dow Jones vs. AKITA Drilling | Dow Jones vs. Chemours Co |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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