Correlation Between ASSGENERALI ADR and Dow Jones
Can any of the company-specific risk be diversified away by investing in both ASSGENERALI ADR 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 ASSGENERALI ADR and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ASSGENERALI ADR 12EO and Dow Jones Industrial, you can compare the effects of market volatilities on ASSGENERALI ADR 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 ASSGENERALI ADR with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of ASSGENERALI ADR and Dow Jones.
Diversification Opportunities for ASSGENERALI ADR and Dow Jones
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between ASSGENERALI and Dow is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding ASSGENERALI ADR 12EO 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 ASSGENERALI ADR 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 ASSGENERALI ADR 12EO 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 ASSGENERALI ADR i.e., ASSGENERALI ADR and Dow Jones go up and down completely randomly.
Pair Corralation between ASSGENERALI ADR and Dow Jones
Assuming the 90 days trading horizon ASSGENERALI ADR is expected to generate 1.27 times less return on investment than Dow Jones. In addition to that, ASSGENERALI ADR is 1.56 times more volatile than Dow Jones Industrial. It trades about 0.12 of its total potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.24 per unit of volatility. If you would invest 4,211,440 in Dow Jones Industrial on August 26, 2024 and sell it today you would earn a total of 218,211 from holding Dow Jones Industrial or generate 5.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ASSGENERALI ADR 12EO vs. Dow Jones Industrial
Performance |
| Timeline |
ASSGENERALI ADR and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
ASSGENERALI ADR 12EO
Pair trading matchups for ASSGENERALI ADR
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with ASSGENERALI ADR and Dow Jones
The main advantage of trading using opposite ASSGENERALI ADR and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ASSGENERALI ADR 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.| ASSGENERALI ADR vs. Allianz SE | ASSGENERALI ADR vs. ALLIANZ SE UNSPADR | ASSGENERALI ADR vs. AXA SA | ASSGENERALI ADR vs. Principal Financial Group |
| Dow Jones vs. Vistra Energy Corp | Dow Jones vs. Fluence Energy | Dow Jones vs. Old Republic International | Dow Jones vs. Empresa Distribuidora y |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
Other Complementary Tools
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios |