Correlation Between Xiangcai and Dow Jones
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By analyzing existing cross correlation between Xiangcai Co and Dow Jones Industrial, you can compare the effects of market volatilities on Xiangcai 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 Xiangcai with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xiangcai and Dow Jones.
Diversification Opportunities for Xiangcai and Dow Jones
Weak diversification
The 3 months correlation between Xiangcai and Dow is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Xiangcai Co 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 Xiangcai 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 Xiangcai Co 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 Xiangcai i.e., Xiangcai and Dow Jones go up and down completely randomly.
Pair Corralation between Xiangcai and Dow Jones
Assuming the 90 days trading horizon Xiangcai is expected to generate 2.24 times less return on investment than Dow Jones. In addition to that, Xiangcai is 3.63 times more volatile than Dow Jones Industrial. It trades about 0.01 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 3,387,678 in Dow Jones Industrial on September 1, 2024 and sell it today you would earn a total of 1,103,387 from holding Dow Jones Industrial or generate 32.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 96.51% |
| Values | Daily Returns |
Xiangcai Co vs. Dow Jones Industrial
Performance |
| Timeline |
Xiangcai and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
Xiangcai Co
Pair trading matchups for Xiangcai
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with Xiangcai and Dow Jones
The main advantage of trading using opposite Xiangcai and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xiangcai 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.| Xiangcai vs. Minmetals Capital Co | Xiangcai vs. Iat Automobile Technology | Xiangcai vs. Industrial Securities Co | Xiangcai vs. Sichuan Yahua Industrial |
| 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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