Correlation Between ACG Acquisition and Dow Jones
Can any of the company-specific risk be diversified away by investing in both ACG Acquisition 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 ACG Acquisition and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ACG Acquisition Co and Dow Jones Industrial, you can compare the effects of market volatilities on ACG Acquisition 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 ACG Acquisition with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of ACG Acquisition and Dow Jones.
Diversification Opportunities for ACG Acquisition and Dow Jones
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between ACG and Dow is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding ACG Acquisition 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 ACG Acquisition 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 ACG Acquisition 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 ACG Acquisition i.e., ACG Acquisition and Dow Jones go up and down completely randomly.
Pair Corralation between ACG Acquisition and Dow Jones
Assuming the 90 days trading horizon ACG Acquisition is expected to generate 57.48 times less return on investment than Dow Jones. In addition to that, ACG Acquisition is 1.18 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 0.36 per unit of volatility. If you would invest 4,179,460 in Dow Jones Industrial on September 4, 2024 and sell it today you would earn a total of 298,740 from holding Dow Jones Industrial or generate 7.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ACG Acquisition Co vs. Dow Jones Industrial
Performance |
| Timeline |
ACG Acquisition and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
ACG Acquisition Co
Pair trading matchups for ACG Acquisition
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with ACG Acquisition and Dow Jones
The main advantage of trading using opposite ACG Acquisition and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ACG Acquisition 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.| ACG Acquisition vs. Sunny Optical Technology | ACG Acquisition vs. CleanTech Lithium plc | ACG Acquisition vs. Cars Inc | ACG Acquisition vs. Naturhouse Health SA |
| Dow Jones vs. Gentex | Dow Jones vs. American Axle Manufacturing | Dow Jones vs. Pearson PLC ADR | Dow Jones vs. Marine Products |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
Other Complementary Tools
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments |