Correlation Between CSPC Innovation and Dow Jones
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By analyzing existing cross correlation between CSPC Innovation Pharmaceutical and Dow Jones Industrial, you can compare the effects of market volatilities on CSPC Innovation 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 CSPC Innovation with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of CSPC Innovation and Dow Jones.
Diversification Opportunities for CSPC Innovation and Dow Jones
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between CSPC and Dow is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding CSPC Innovation Pharmaceutical 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 CSPC Innovation 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 CSPC Innovation Pharmaceutical 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 CSPC Innovation i.e., CSPC Innovation and Dow Jones go up and down completely randomly.
Pair Corralation between CSPC Innovation and Dow Jones
Assuming the 90 days trading horizon CSPC Innovation Pharmaceutical is expected to generate 3.29 times more return on investment than Dow Jones. However, CSPC Innovation is 3.29 times more volatile than Dow Jones Industrial. It trades about 0.17 of its potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.37 per unit of risk. If you would invest 2,548 in CSPC Innovation Pharmaceutical on September 1, 2024 and sell it today you would earn a total of 303.00 from holding CSPC Innovation Pharmaceutical or generate 11.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 91.3% |
| Values | Daily Returns |
CSPC Innovation Pharmaceutical vs. Dow Jones Industrial
Performance |
| Timeline |
CSPC Innovation and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
CSPC Innovation Pharmaceutical
Pair trading matchups for CSPC Innovation
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with CSPC Innovation and Dow Jones
The main advantage of trading using opposite CSPC Innovation and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CSPC Innovation 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.| CSPC Innovation vs. Juneyao Airlines | CSPC Innovation vs. Sunwave Communications Co | CSPC Innovation vs. Elite Color Environmental | CSPC Innovation vs. Jiangxi JDL Environmental |
| 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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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