Correlation Between Hangzhou Weiguang and Dow Jones
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By analyzing existing cross correlation between Hangzhou Weiguang Electronic and Dow Jones Industrial, you can compare the effects of market volatilities on Hangzhou Weiguang 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 Hangzhou Weiguang with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hangzhou Weiguang and Dow Jones.
Diversification Opportunities for Hangzhou Weiguang and Dow Jones
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Hangzhou and Dow is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Hangzhou Weiguang Electronic 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 Hangzhou Weiguang 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 Hangzhou Weiguang Electronic 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 Hangzhou Weiguang i.e., Hangzhou Weiguang and Dow Jones go up and down completely randomly.
Pair Corralation between Hangzhou Weiguang and Dow Jones
Assuming the 90 days trading horizon Hangzhou Weiguang Electronic is expected to generate 2.79 times more return on investment than Dow Jones. However, Hangzhou Weiguang is 2.79 times more volatile than Dow Jones Industrial. It trades about 0.19 of its potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.27 per unit of risk. If you would invest 2,127 in Hangzhou Weiguang Electronic on August 30, 2024 and sell it today you would earn a total of 236.00 from holding Hangzhou Weiguang Electronic or generate 11.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hangzhou Weiguang Electronic vs. Dow Jones Industrial
Performance |
| Timeline |
Hangzhou Weiguang and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
Hangzhou Weiguang Electronic
Pair trading matchups for Hangzhou Weiguang
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with Hangzhou Weiguang and Dow Jones
The main advantage of trading using opposite Hangzhou Weiguang and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hangzhou Weiguang 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.| Hangzhou Weiguang vs. PetroChina Co Ltd | Hangzhou Weiguang vs. China State Construction | Hangzhou Weiguang vs. China Mobile Limited | Hangzhou Weiguang vs. Industrial and Commercial |
| Dow Jones vs. Kaltura | Dow Jones vs. Artisan Partners Asset | Dow Jones vs. US Global Investors | Dow Jones vs. Analog Devices |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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