Correlation Between Astor Long/short and Dow Jones
Can any of the company-specific risk be diversified away by investing in both Astor Long/short 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 Astor Long/short and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Astor Longshort Fund and Dow Jones Industrial, you can compare the effects of market volatilities on Astor Long/short 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 Astor Long/short with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of Astor Long/short and Dow Jones.
Diversification Opportunities for Astor Long/short and Dow Jones
0.98 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Astor and Dow is 0.98. Overlapping area represents the amount of risk that can be diversified away by holding Astor Longshort Fund 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 Astor Long/short 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 Astor Longshort Fund 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 Astor Long/short i.e., Astor Long/short and Dow Jones go up and down completely randomly.
Pair Corralation between Astor Long/short and Dow Jones
Assuming the 90 days horizon Astor Long/short is expected to generate 1.75 times less return on investment than Dow Jones. But when comparing it to its historical volatility, Astor Longshort Fund is 1.95 times less risky than Dow Jones. It trades about 0.09 of its potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 3,359,634 in Dow Jones Industrial on August 27, 2024 and sell it today you would earn a total of 1,070,017 from holding Dow Jones Industrial or generate 31.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Astor Longshort Fund vs. Dow Jones Industrial
Performance |
| Timeline |
Astor Long/short and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
Astor Longshort Fund
Pair trading matchups for Astor Long/short
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with Astor Long/short and Dow Jones
The main advantage of trading using opposite Astor Long/short and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Astor Long/short 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.| Astor Long/short vs. Transamerica Funds | Astor Long/short vs. Dreyfus Institutional Reserves | Astor Long/short vs. Pioneer Money Market | Astor Long/short vs. Franklin Government Money |
| Dow Jones vs. Meiwu Technology Co | Dow Jones vs. 17 Education Technology | Dow Jones vs. 51Talk Online Education | Dow Jones vs. Afya |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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