Correlation Between GS Engineering and Dow Jones
Can any of the company-specific risk be diversified away by investing in both GS Engineering and Dow Jones 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 GS Engineering and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GS Engineering Construction and Dow Jones Industrial, you can compare the effects of market volatilities on GS Engineering 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 GS Engineering with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of GS Engineering and Dow Jones.
Diversification Opportunities for GS Engineering and Dow Jones
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between 006360 and Dow is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding GS Engineering Construction 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 GS Engineering 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 GS Engineering Construction 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 GS Engineering i.e., GS Engineering and Dow Jones go up and down completely randomly.
Pair Corralation between GS Engineering and Dow Jones
Assuming the 90 days trading horizon GS Engineering Construction is expected to generate 3.67 times more return on investment than Dow Jones. However, GS Engineering is 3.67 times more volatile than Dow Jones Industrial. It trades about 0.09 of its potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.16 per unit of risk. If you would invest 1,514,000 in GS Engineering Construction on August 30, 2024 and sell it today you would earn a total of 446,000 from holding GS Engineering Construction or generate 29.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 96.03% |
| Values | Daily Returns |
GS Engineering Construction vs. Dow Jones Industrial
Performance |
| Timeline |
GS Engineering and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
GS Engineering Construction
Pair trading matchups for GS Engineering
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with GS Engineering and Dow Jones
The main advantage of trading using opposite GS Engineering and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GS Engineering 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.| GS Engineering vs. Taegu Broadcasting | GS Engineering vs. PH Tech Co | GS Engineering vs. Intellian Technologies | GS Engineering vs. Konan Technology |
| Dow Jones vs. Skillful Craftsman Education | Dow Jones vs. Acco Brands | Dow Jones vs. Cracker Barrel Old | Dow Jones vs. Coursera |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
Other Complementary Tools
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity |