Correlation Between Dow Jones and Shenzhen INVT
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By analyzing existing cross correlation between Dow Jones Industrial and Shenzhen INVT Electric, you can compare the effects of market volatilities on Dow Jones and Shenzhen INVT 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 Shenzhen INVT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dow Jones and Shenzhen INVT.
Diversification Opportunities for Dow Jones and Shenzhen INVT
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Dow and Shenzhen is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Dow Jones Industrial and Shenzhen INVT Electric in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenzhen INVT Electric 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 Shenzhen INVT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenzhen INVT Electric has no effect on the direction of Dow Jones i.e., Dow Jones and Shenzhen INVT go up and down completely randomly.
Pair Corralation between Dow Jones and Shenzhen INVT
Assuming the 90 days trading horizon Dow Jones is expected to generate 234.06 times less return on investment than Shenzhen INVT. But when comparing it to its historical volatility, Dow Jones Industrial is 4.19 times less risky than Shenzhen INVT. It trades about 0.0 of its potential returns per unit of risk. Shenzhen INVT Electric is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 725.00 in Shenzhen INVT Electric on September 13, 2024 and sell it today you would earn a total of 65.00 from holding Shenzhen INVT Electric or generate 8.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Dow Jones Industrial vs. Shenzhen INVT Electric
Performance |
| Timeline |
Dow Jones and Shenzhen INVT Volatility Contrast
Predicted Return Density |
| Returns |
Dow Jones Industrial
Pair trading matchups for Dow Jones
Shenzhen INVT Electric
Pair trading matchups for Shenzhen INVT
Pair Trading with Dow Jones and Shenzhen INVT
The main advantage of trading using opposite Dow Jones and Shenzhen INVT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dow Jones position performs unexpectedly, Shenzhen INVT 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 Shenzhen INVT will offset losses from the drop in Shenzhen INVT's long position.| Dow Jones vs. Hurco Companies | Dow Jones vs. Tyson Foods | Dow Jones vs. MYR Group | Dow Jones vs. Cannae Holdings |
| Shenzhen INVT vs. Industrial and Commercial | Shenzhen INVT vs. Agricultural Bank of | Shenzhen INVT vs. China Construction Bank | Shenzhen INVT vs. Bank of China |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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