Correlation Between Guangdong Wens and Dow Jones
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By analyzing existing cross correlation between Guangdong Wens Foodstuff and Dow Jones Industrial, you can compare the effects of market volatilities on Guangdong Wens 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 Guangdong Wens with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangdong Wens and Dow Jones.
Diversification Opportunities for Guangdong Wens and Dow Jones
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Guangdong and Dow is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Guangdong Wens Foodstuff 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 Guangdong Wens 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 Guangdong Wens Foodstuff 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 Guangdong Wens i.e., Guangdong Wens and Dow Jones go up and down completely randomly.
Pair Corralation between Guangdong Wens and Dow Jones
Assuming the 90 days trading horizon Guangdong Wens Foodstuff is expected to under-perform the Dow Jones. In addition to that, Guangdong Wens is 3.35 times more volatile than Dow Jones Industrial. It trades about -0.06 of its total potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.16 per unit of volatility. If you would invest 3,857,103 in Dow Jones Industrial on September 1, 2024 and sell it today you would earn a total of 633,962 from holding Dow Jones Industrial or generate 16.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 96.83% |
| Values | Daily Returns |
Guangdong Wens Foodstuff vs. Dow Jones Industrial
Performance |
| Timeline |
Guangdong Wens and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
Guangdong Wens Foodstuff
Pair trading matchups for Guangdong Wens
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with Guangdong Wens and Dow Jones
The main advantage of trading using opposite Guangdong Wens and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangdong Wens 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.| Guangdong Wens vs. Jiangsu Xinri E Vehicle | Guangdong Wens vs. Ningbo Fangzheng Automobile | Guangdong Wens vs. Haima Automobile Group | Guangdong Wens vs. Dongfeng Automobile Co |
| Dow Jones vs. Catalyst Pharmaceuticals | Dow Jones vs. Sphere Entertainment Co | Dow Jones vs. National CineMedia | Dow Jones vs. Mink Therapeutics |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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