Correlation Between COUNTRY GARDEN and Dow Jones
Can any of the company-specific risk be diversified away by investing in both COUNTRY GARDEN 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 COUNTRY GARDEN and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between COUNTRY GARDEN SVDL 0001 and Dow Jones Industrial, you can compare the effects of market volatilities on COUNTRY GARDEN 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 COUNTRY GARDEN with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of COUNTRY GARDEN and Dow Jones.
Diversification Opportunities for COUNTRY GARDEN and Dow Jones
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between COUNTRY and Dow is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding COUNTRY GARDEN SVDL 0001 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 COUNTRY GARDEN 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 COUNTRY GARDEN SVDL 0001 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 COUNTRY GARDEN i.e., COUNTRY GARDEN and Dow Jones go up and down completely randomly.
Pair Corralation between COUNTRY GARDEN and Dow Jones
Assuming the 90 days horizon COUNTRY GARDEN SVDL 0001 is expected to generate 13.25 times more return on investment than Dow Jones. However, COUNTRY GARDEN is 13.25 times more volatile than Dow Jones Industrial. It trades about 0.06 of its potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.11 per unit of risk. If you would invest 37.00 in COUNTRY GARDEN SVDL 0001 on November 28, 2024 and sell it today you would earn a total of 25.00 from holding COUNTRY GARDEN SVDL 0001 or generate 67.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 98.49% |
| Values | Daily Returns |
COUNTRY GARDEN SVDL 0001 vs. Dow Jones Industrial
Performance |
| Timeline |
COUNTRY GARDEN and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
COUNTRY GARDEN SVDL 0001
Pair trading matchups for COUNTRY GARDEN
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with COUNTRY GARDEN and Dow Jones
The main advantage of trading using opposite COUNTRY GARDEN and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if COUNTRY GARDEN 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.| COUNTRY GARDEN vs. ZURICH INSURANCE GROUP | COUNTRY GARDEN vs. AUTO TRADER ADR | COUNTRY GARDEN vs. Singapore Reinsurance | COUNTRY GARDEN vs. Zurich Insurance Group |
| 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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