Correlation Between Shin Heung and Dow Jones
Can any of the company-specific risk be diversified away by investing in both Shin Heung 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 Shin Heung and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shin Heung Energy and Dow Jones Industrial, you can compare the effects of market volatilities on Shin Heung 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 Shin Heung with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shin Heung and Dow Jones.
Diversification Opportunities for Shin Heung and Dow Jones
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Shin and Dow is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Shin Heung Energy 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 Shin Heung 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 Shin Heung Energy 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 Shin Heung i.e., Shin Heung and Dow Jones go up and down completely randomly.
Pair Corralation between Shin Heung and Dow Jones
Assuming the 90 days trading horizon Shin Heung Energy is expected to under-perform the Dow Jones. In addition to that, Shin Heung is 3.54 times more volatile than Dow Jones Industrial. It trades about -0.03 of its total potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.08 per unit of volatility. If you would invest 3,394,710 in Dow Jones Industrial on August 26, 2024 and sell it today you would earn a total of 1,034,941 from holding Dow Jones Industrial or generate 30.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 94.97% |
| Values | Daily Returns |
Shin Heung Energy vs. Dow Jones Industrial
Performance |
| Timeline |
Shin Heung and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
Shin Heung Energy
Pair trading matchups for Shin Heung
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with Shin Heung and Dow Jones
The main advantage of trading using opposite Shin Heung and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shin Heung 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.| Shin Heung vs. Youngchang Chemical Co | Shin Heung vs. Miwon Chemical | Shin Heung vs. Daehan Steel | Shin Heung vs. TK Chemical |
| Dow Jones vs. Vistra Energy Corp | Dow Jones vs. Fluence Energy | Dow Jones vs. Old Republic International | Dow Jones vs. Empresa Distribuidora y |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
Other Complementary Tools
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments |