Correlation Between Dow Jones and Zhejiang Yinlun
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By analyzing existing cross correlation between Dow Jones Industrial and Zhejiang Yinlun Machinery, you can compare the effects of market volatilities on Dow Jones and Zhejiang Yinlun 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 Zhejiang Yinlun. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dow Jones and Zhejiang Yinlun.
Diversification Opportunities for Dow Jones and Zhejiang Yinlun
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Dow and Zhejiang is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Dow Jones Industrial and Zhejiang Yinlun Machinery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhejiang Yinlun Machinery 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 Zhejiang Yinlun. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhejiang Yinlun Machinery has no effect on the direction of Dow Jones i.e., Dow Jones and Zhejiang Yinlun go up and down completely randomly.
Pair Corralation between Dow Jones and Zhejiang Yinlun
Assuming the 90 days trading horizon Dow Jones Industrial is expected to generate 0.45 times more return on investment than Zhejiang Yinlun. However, Dow Jones Industrial is 2.23 times less risky than Zhejiang Yinlun. It trades about 0.37 of its potential returns per unit of risk. Zhejiang Yinlun Machinery is currently generating about -0.12 per unit of risk. If you would invest 4,176,346 in Dow Jones Industrial on September 1, 2024 and sell it today you would earn a total of 314,719 from holding Dow Jones Industrial or generate 7.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Dow Jones Industrial vs. Zhejiang Yinlun Machinery
Performance |
| Timeline |
Dow Jones and Zhejiang Yinlun Volatility Contrast
Predicted Return Density |
| Returns |
Dow Jones Industrial
Pair trading matchups for Dow Jones
Zhejiang Yinlun Machinery
Pair trading matchups for Zhejiang Yinlun
Pair Trading with Dow Jones and Zhejiang Yinlun
The main advantage of trading using opposite Dow Jones and Zhejiang Yinlun positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dow Jones position performs unexpectedly, Zhejiang Yinlun 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 Zhejiang Yinlun will offset losses from the drop in Zhejiang Yinlun's long position.| Dow Jones vs. Catalyst Pharmaceuticals | Dow Jones vs. Sphere Entertainment Co | Dow Jones vs. National CineMedia | Dow Jones vs. Mink Therapeutics |
| Zhejiang Yinlun vs. BYD Co Ltd | Zhejiang Yinlun vs. China Mobile Limited | Zhejiang Yinlun vs. Agricultural Bank of | Zhejiang Yinlun vs. Industrial and Commercial |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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