Correlation Between Blue Dolphin and Dow Jones
Can any of the company-specific risk be diversified away by investing in both Blue Dolphin 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 Blue Dolphin and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Blue Dolphin Energy and Dow Jones Industrial, you can compare the effects of market volatilities on Blue Dolphin 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 Blue Dolphin with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blue Dolphin and Dow Jones.
Diversification Opportunities for Blue Dolphin and Dow Jones
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Blue and Dow is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Blue Dolphin Energy 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 Blue Dolphin 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 Blue Dolphin Energy 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 Blue Dolphin i.e., Blue Dolphin and Dow Jones go up and down completely randomly.
Pair Corralation between Blue Dolphin and Dow Jones
If you would invest 4,214,154 in Dow Jones Industrial on August 31, 2024 and sell it today you would earn a total of 258,052 from holding Dow Jones Industrial or generate 6.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 4.55% |
| Values | Daily Returns |
Blue Dolphin Energy vs. Dow Jones Industrial
Performance |
| Timeline |
Blue Dolphin and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
Blue Dolphin Energy
Pair trading matchups for Blue Dolphin
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with Blue Dolphin and Dow Jones
The main advantage of trading using opposite Blue Dolphin and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blue Dolphin 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.| Blue Dolphin vs. Aemetis | Blue Dolphin vs. PBF Energy | Blue Dolphin vs. Clean Energy Fuels | Blue Dolphin vs. Par Pacific Holdings |
| Dow Jones vs. Aerofoam Metals | Dow Jones vs. ACG Metals Limited | Dow Jones vs. China Clean Energy | Dow Jones vs. Fast Retailing Co |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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