Correlation Between Dow Jones and Guangdong Jingyi
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By analyzing existing cross correlation between Dow Jones Industrial and Guangdong Jingyi Metal, you can compare the effects of market volatilities on Dow Jones and Guangdong Jingyi 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 Guangdong Jingyi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dow Jones and Guangdong Jingyi.
Diversification Opportunities for Dow Jones and Guangdong Jingyi
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Dow and Guangdong is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Dow Jones Industrial and Guangdong Jingyi Metal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangdong Jingyi Metal 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 Guangdong Jingyi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangdong Jingyi Metal has no effect on the direction of Dow Jones i.e., Dow Jones and Guangdong Jingyi go up and down completely randomly.
Pair Corralation between Dow Jones and Guangdong Jingyi
Assuming the 90 days trading horizon Dow Jones Industrial is expected to generate 0.26 times more return on investment than Guangdong Jingyi. However, Dow Jones Industrial is 3.91 times less risky than Guangdong Jingyi. It trades about 0.08 of its potential returns per unit of risk. Guangdong Jingyi Metal is currently generating about 0.01 per unit of risk. If you would invest 3,424,593 in Dow Jones Industrial on November 2, 2024 and sell it today you would earn a total of 1,063,620 from holding Dow Jones Industrial or generate 31.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 96.77% |
| Values | Daily Returns |
Dow Jones Industrial vs. Guangdong Jingyi Metal
Performance |
| Timeline |
Dow Jones and Guangdong Jingyi Volatility Contrast
Predicted Return Density |
| Returns |
Dow Jones Industrial
Pair trading matchups for Dow Jones
Guangdong Jingyi Metal
Pair trading matchups for Guangdong Jingyi
Pair Trading with Dow Jones and Guangdong Jingyi
The main advantage of trading using opposite Dow Jones and Guangdong Jingyi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dow Jones position performs unexpectedly, Guangdong Jingyi 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 Guangdong Jingyi will offset losses from the drop in Guangdong Jingyi's long position.| Dow Jones vs. Cincinnati Financial | Dow Jones vs. Kellanova | Dow Jones vs. Acme United | Dow Jones vs. Procter Gamble |
| Guangdong Jingyi vs. Sinomach Automobile Co | Guangdong Jingyi vs. Pengxin International Mining | Guangdong Jingyi vs. Fiberhome Telecommunication Technologies | Guangdong Jingyi vs. Shengda Mining Co |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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