Correlation Between Guotai Junan and Dow Jones
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By analyzing existing cross correlation between Guotai Junan Securities and Dow Jones Industrial, you can compare the effects of market volatilities on Guotai Junan 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 Guotai Junan with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guotai Junan and Dow Jones.
Diversification Opportunities for Guotai Junan and Dow Jones
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between Guotai and Dow is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Guotai Junan Securities 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 Guotai Junan 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 Guotai Junan Securities 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 Guotai Junan i.e., Guotai Junan and Dow Jones go up and down completely randomly.
Pair Corralation between Guotai Junan and Dow Jones
Assuming the 90 days trading horizon Guotai Junan Securities is expected to generate 1.58 times more return on investment than Dow Jones. However, Guotai Junan is 1.58 times more volatile than Dow Jones Industrial. It trades about 0.13 of its potential returns per unit of risk. Dow Jones Industrial is currently generating about -0.21 per unit of risk. If you would invest 1,773 in Guotai Junan Securities on November 28, 2024 and sell it today you would earn a total of 37.00 from holding Guotai Junan Securities or generate 2.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 77.27% |
| Values | Daily Returns |
Guotai Junan Securities vs. Dow Jones Industrial
Performance |
| Timeline |
Guotai Junan and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
Guotai Junan Securities
Pair trading matchups for Guotai Junan
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with Guotai Junan and Dow Jones
The main advantage of trading using opposite Guotai Junan and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guotai Junan 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.| Guotai Junan vs. Jiangxi Lianchuang Opto electronic | Guotai Junan vs. Guangdong Silvere Sci | Guotai Junan vs. Zijin Mining Group | Guotai Junan vs. Sihui Fuji Electronics |
| Dow Jones vs. Gladstone Investment | Dow Jones vs. BW Offshore Limited | Dow Jones vs. Fidus Investment Corp | Dow Jones vs. Aperture Health |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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