Correlation Between Dow Jones and Xiamen Kehua
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By analyzing existing cross correlation between Dow Jones Industrial and Xiamen Kehua Hengsheng, you can compare the effects of market volatilities on Dow Jones and Xiamen Kehua 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 Xiamen Kehua. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dow Jones and Xiamen Kehua.
Diversification Opportunities for Dow Jones and Xiamen Kehua
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Dow and Xiamen is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Dow Jones Industrial and Xiamen Kehua Hengsheng in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xiamen Kehua Hengsheng 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 Xiamen Kehua. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xiamen Kehua Hengsheng has no effect on the direction of Dow Jones i.e., Dow Jones and Xiamen Kehua go up and down completely randomly.
Pair Corralation between Dow Jones and Xiamen Kehua
Assuming the 90 days trading horizon Dow Jones Industrial is expected to generate 0.23 times more return on investment than Xiamen Kehua. However, Dow Jones Industrial is 4.27 times less risky than Xiamen Kehua. It trades about 0.08 of its potential returns per unit of risk. Xiamen Kehua Hengsheng is currently generating about -0.02 per unit of risk. If you would invest 3,369,988 in Dow Jones Industrial on October 31, 2024 and sell it today you would earn a total of 1,115,047 from holding Dow Jones Industrial or generate 33.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 97.37% |
| Values | Daily Returns |
Dow Jones Industrial vs. Xiamen Kehua Hengsheng
Performance |
| Timeline |
Dow Jones and Xiamen Kehua Volatility Contrast
Predicted Return Density |
| Returns |
Dow Jones Industrial
Pair trading matchups for Dow Jones
Xiamen Kehua Hengsheng
Pair trading matchups for Xiamen Kehua
Pair Trading with Dow Jones and Xiamen Kehua
The main advantage of trading using opposite Dow Jones and Xiamen Kehua positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dow Jones position performs unexpectedly, Xiamen Kehua 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 Xiamen Kehua will offset losses from the drop in Xiamen Kehua's long position.| Dow Jones vs. Monster Beverage Corp | Dow Jones vs. BioNTech SE | Dow Jones vs. Acumen Pharmaceuticals | Dow Jones vs. SNDL Inc |
| Xiamen Kehua vs. Southern PublishingMedia Co | Xiamen Kehua vs. Shantou Wanshun Package | Xiamen Kehua vs. Beijing Sanyuan Foods | Xiamen Kehua vs. Guangdong Wens Foodstuff |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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