Correlation Between ETFS Swiss and Dow Jones
Can any of the company-specific risk be diversified away by investing in both ETFS Swiss 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 ETFS Swiss and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ETFS Swiss Franc and Dow Jones Industrial, you can compare the effects of market volatilities on ETFS Swiss 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 ETFS Swiss with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of ETFS Swiss and Dow Jones.
Diversification Opportunities for ETFS Swiss and Dow Jones
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between ETFS and Dow is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding ETFS Swiss Franc 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 ETFS Swiss 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 ETFS Swiss Franc 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 ETFS Swiss i.e., ETFS Swiss and Dow Jones go up and down completely randomly.
Pair Corralation between ETFS Swiss and Dow Jones
If you would invest 4,293,160 in Dow Jones Industrial on September 19, 2024 and sell it today you would earn a total of 51,830 from holding Dow Jones Industrial or generate 1.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
ETFS Swiss Franc vs. Dow Jones Industrial
Performance |
| Timeline |
ETFS Swiss and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with ETFS Swiss and Dow Jones
The main advantage of trading using opposite ETFS Swiss and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ETFS Swiss 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.The idea behind ETFS Swiss Franc and Dow Jones Industrial pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Dow Jones vs. Mangazeya Mining | Dow Jones vs. Summit Materials | Dow Jones vs. Perseus Mining Limited | Dow Jones vs. AMCON Distributing |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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