Correlation Between Dow Jones and Jiangxi Sunshine
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By analyzing existing cross correlation between Dow Jones Industrial and Jiangxi Sunshine Dairy, you can compare the effects of market volatilities on Dow Jones and Jiangxi Sunshine 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 Dow Jones with a short position of Jiangxi Sunshine. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dow Jones and Jiangxi Sunshine.
Diversification Opportunities for Dow Jones and Jiangxi Sunshine
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Dow and Jiangxi is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Dow Jones Industrial and Jiangxi Sunshine Dairy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiangxi Sunshine Dairy and Dow Jones 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 Dow Jones Industrial are associated (or correlated) with Jiangxi Sunshine. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiangxi Sunshine Dairy has no effect on the direction of Dow Jones i.e., Dow Jones and Jiangxi Sunshine go up and down completely randomly.
Pair Corralation between Dow Jones and Jiangxi Sunshine
Assuming the 90 days trading horizon Dow Jones Industrial is expected to generate 0.31 times more return on investment than Jiangxi Sunshine. However, Dow Jones Industrial is 3.26 times less risky than Jiangxi Sunshine. It trades about 0.08 of its potential returns per unit of risk. Jiangxi Sunshine Dairy is currently generating about 0.0 per unit of risk. If you would invest 3,324,156 in Dow Jones Industrial on September 14, 2024 and sell it today you would earn a total of 1,067,256 from holding Dow Jones Industrial or generate 32.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 96.36% |
| Values | Daily Returns |
Dow Jones Industrial vs. Jiangxi Sunshine Dairy
Performance |
| Timeline |
Dow Jones and Jiangxi Sunshine Volatility Contrast
Predicted Return Density |
| Returns |
Dow Jones Industrial
Pair trading matchups for Dow Jones
Jiangxi Sunshine Dairy
Pair trading matchups for Jiangxi Sunshine
Pair Trading with Dow Jones and Jiangxi Sunshine
The main advantage of trading using opposite Dow Jones and Jiangxi Sunshine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dow Jones position performs unexpectedly, Jiangxi Sunshine 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 Jiangxi Sunshine will offset losses from the drop in Jiangxi Sunshine's long position.| Dow Jones vs. Hurco Companies | Dow Jones vs. Tyson Foods | Dow Jones vs. MYR Group | Dow Jones vs. Cannae Holdings |
| Jiangxi Sunshine vs. Sinosteel Engineering and | Jiangxi Sunshine vs. Shenwu Energy Saving | Jiangxi Sunshine vs. Ping An Insurance | Jiangxi Sunshine vs. Easyhome New Retail |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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