Correlation Between PHN - and Dow Jones
Can any of the company-specific risk be diversified away by investing in both PHN - 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 PHN - and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PHN Frankfurt and Dow Jones Industrial, you can compare the effects of market volatilities on PHN - 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 PHN - with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of PHN - and Dow Jones.
Diversification Opportunities for PHN - and Dow Jones
Pay attention - limited upside
The 3 months correlation between PHN and Dow is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding PHN Frankfurt 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 PHN - 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 PHN Frankfurt 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 PHN - i.e., PHN - and Dow Jones go up and down completely randomly.
Pair Corralation between PHN - and Dow Jones
Assuming the 90 days horizon PHN Frankfurt is expected to under-perform the Dow Jones. In addition to that, PHN - is 4.32 times more volatile than Dow Jones Industrial. It trades about -0.02 of its total potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.12 per unit of volatility. If you would invest 3,640,493 in Dow Jones Industrial on September 4, 2024 and sell it today you would earn a total of 837,707 from holding Dow Jones Industrial or generate 23.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 98.4% |
| Values | Daily Returns |
PHN Frankfurt vs. Dow Jones Industrial
Performance |
| Timeline |
PHN - and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
PHN Frankfurt
Pair trading matchups for PHN -
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with PHN - and Dow Jones
The main advantage of trading using opposite PHN - and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PHN - 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.| PHN - vs. GRIFFIN MINING LTD | PHN - vs. Lion One Metals | PHN - vs. Hollywood Bowl Group | PHN - vs. PT Global Mediacom |
| 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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
Other Complementary Tools
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon |