Correlation Between Owens Minor and Dow Jones
Can any of the company-specific risk be diversified away by investing in both Owens Minor 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 Owens Minor and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Owens Minor and Dow Jones Industrial, you can compare the effects of market volatilities on Owens Minor 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 Owens Minor with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of Owens Minor and Dow Jones.
Diversification Opportunities for Owens Minor and Dow Jones
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Owens and Dow is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Owens Minor 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 Owens Minor 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 Owens Minor 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 Owens Minor i.e., Owens Minor and Dow Jones go up and down completely randomly.
Pair Corralation between Owens Minor and Dow Jones
Assuming the 90 days horizon Owens Minor is expected to generate 3.56 times more return on investment than Dow Jones. However, Owens Minor is 3.56 times more volatile than Dow Jones Industrial. It trades about 0.35 of its potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.17 per unit of risk. If you would invest 1,200 in Owens Minor on October 24, 2024 and sell it today you would earn a total of 210.00 from holding Owens Minor or generate 17.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 89.47% |
| Values | Daily Returns |
Owens Minor vs. Dow Jones Industrial
Performance |
| Timeline |
Owens Minor and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
Owens Minor
Pair trading matchups for Owens Minor
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with Owens Minor and Dow Jones
The main advantage of trading using opposite Owens Minor and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Owens Minor 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.| Owens Minor vs. Wizz Air Holdings | Owens Minor vs. FAIR ISAAC | Owens Minor vs. WIZZ AIR HLDGUNSPADR4 | Owens Minor vs. Air New Zealand |
| Dow Jones vs. Transocean | Dow Jones vs. Noble plc | Dow Jones vs. Evolution Gaming Group | Dow Jones vs. Addus HomeCare |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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