Correlation Between CubicFarm Systems and Dow Jones
Can any of the company-specific risk be diversified away by investing in both CubicFarm Systems 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 CubicFarm Systems and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CubicFarm Systems Corp and Dow Jones Industrial, you can compare the effects of market volatilities on CubicFarm Systems 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 CubicFarm Systems with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of CubicFarm Systems and Dow Jones.
Diversification Opportunities for CubicFarm Systems and Dow Jones
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between CubicFarm and Dow is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding CubicFarm Systems Corp 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 CubicFarm Systems 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 CubicFarm Systems Corp 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 CubicFarm Systems i.e., CubicFarm Systems and Dow Jones go up and down completely randomly.
Pair Corralation between CubicFarm Systems and Dow Jones
Assuming the 90 days horizon CubicFarm Systems Corp is expected to generate 111.7 times more return on investment than Dow Jones. However, CubicFarm Systems is 111.7 times more volatile than Dow Jones Industrial. It trades about 0.12 of its potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.08 per unit of risk. If you would invest 50.00 in CubicFarm Systems Corp on September 2, 2024 and sell it today you would lose (49.45) from holding CubicFarm Systems Corp or give up 98.9% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 96.37% |
| Values | Daily Returns |
CubicFarm Systems Corp vs. Dow Jones Industrial
Performance |
| Timeline |
CubicFarm Systems and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
CubicFarm Systems Corp
Pair trading matchups for CubicFarm Systems
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with CubicFarm Systems and Dow Jones
The main advantage of trading using opposite CubicFarm Systems and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CubicFarm Systems 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.| CubicFarm Systems vs. Lion Electric Corp | CubicFarm Systems vs. Nikola Corp | CubicFarm Systems vs. Buhler Industries | CubicFarm Systems vs. Toyota Industries |
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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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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