Correlation Between Abrdn Bloomberg and Dow Jones
Can any of the company-specific risk be diversified away by investing in both Abrdn Bloomberg 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 Abrdn Bloomberg and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between abrdn Bloomberg All and Dow Jones Hong, you can compare the effects of market volatilities on Abrdn Bloomberg 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 Abrdn Bloomberg with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of Abrdn Bloomberg and Dow Jones.
Diversification Opportunities for Abrdn Bloomberg and Dow Jones
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Abrdn and Dow is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding abrdn Bloomberg All and Dow Jones Hong in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dow Jones Hong and Abrdn Bloomberg 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 abrdn Bloomberg All 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 Hong has no effect on the direction of Abrdn Bloomberg i.e., Abrdn Bloomberg and Dow Jones go up and down completely randomly.
Pair Corralation between Abrdn Bloomberg and Dow Jones
Considering the 90-day investment horizon abrdn Bloomberg All is expected to generate 0.63 times more return on investment than Dow Jones. However, abrdn Bloomberg All is 1.58 times less risky than Dow Jones. It trades about 0.0 of its potential returns per unit of risk. Dow Jones Hong is currently generating about -0.03 per unit of risk. If you would invest 3,283 in abrdn Bloomberg All on September 2, 2024 and sell it today you would lose (59.00) from holding abrdn Bloomberg All or give up 1.8% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 97.06% |
| Values | Daily Returns |
abrdn Bloomberg All vs. Dow Jones Hong
Performance |
| Timeline |
Abrdn Bloomberg and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
abrdn Bloomberg All
Pair trading matchups for Abrdn Bloomberg
Dow Jones Hong
Pair trading matchups for Dow Jones
Pair Trading with Abrdn Bloomberg and Dow Jones
The main advantage of trading using opposite Abrdn Bloomberg and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Abrdn Bloomberg 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.| Abrdn Bloomberg vs. abrdn Bloomberg All | Abrdn Bloomberg vs. iShares Bloomberg Roll | Abrdn Bloomberg vs. GraniteShares Bloomberg Commodity | Abrdn Bloomberg vs. iShares GSCI Commodity |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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