Correlation Between Beam Global and Dow Jones
Can any of the company-specific risk be diversified away by investing in both Beam Global 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 Beam Global and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Beam Global and Dow Jones Industrial, you can compare the effects of market volatilities on Beam Global 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 Beam Global with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beam Global and Dow Jones.
Diversification Opportunities for Beam Global and Dow Jones
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Beam and Dow is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Beam Global 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 Beam Global 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 Beam Global 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 Beam Global i.e., Beam Global and Dow Jones go up and down completely randomly.
Pair Corralation between Beam Global and Dow Jones
Given the investment horizon of 90 days Beam Global is expected to under-perform the Dow Jones. In addition to that, Beam Global is 6.59 times more volatile than Dow Jones Industrial. It trades about -0.05 of its total potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.1 per unit of volatility. If you would invest 3,360,115 in Dow Jones Industrial on August 25, 2024 and sell it today you would earn a total of 1,069,536 from holding Dow Jones Industrial or generate 31.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.76% |
| Values | Daily Returns |
Beam Global vs. Dow Jones Industrial
Performance |
| Timeline |
Beam Global and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
Beam Global
Pair trading matchups for Beam Global
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with Beam Global and Dow Jones
The main advantage of trading using opposite Beam Global and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beam Global 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.| Beam Global vs. Sunrun Inc | Beam Global vs. Emeren Group | Beam Global vs. Sunnova Energy International | Beam Global vs. Maxeon Solar Technologies |
| Dow Jones vs. Sphere Entertainment Co | Dow Jones vs. Perseus Mining Limited | Dow Jones vs. Titan Machinery | Dow Jones vs. Simon Property Group |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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