Correlation Between Dow Jones and Zhejiang Weixing
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By analyzing existing cross correlation between Dow Jones Industrial and Zhejiang Weixing New, you can compare the effects of market volatilities on Dow Jones and Zhejiang Weixing 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 Weixing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dow Jones and Zhejiang Weixing.
Diversification Opportunities for Dow Jones and Zhejiang Weixing
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Dow and Zhejiang is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Dow Jones Industrial and Zhejiang Weixing New in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhejiang Weixing New 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 Weixing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhejiang Weixing New has no effect on the direction of Dow Jones i.e., Dow Jones and Zhejiang Weixing go up and down completely randomly.
Pair Corralation between Dow Jones and Zhejiang Weixing
Assuming the 90 days trading horizon Dow Jones Industrial is expected to generate 0.32 times more return on investment than Zhejiang Weixing. However, Dow Jones Industrial is 3.08 times less risky than Zhejiang Weixing. It trades about 0.08 of its potential returns per unit of risk. Zhejiang Weixing New is currently generating about -0.03 per unit of risk. If you would invest 3,394,710 in Dow Jones Industrial on August 26, 2024 and sell it today you would earn a total of 1,034,941 from holding Dow Jones Industrial or generate 30.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 96.18% |
| Values | Daily Returns |
Dow Jones Industrial vs. Zhejiang Weixing New
Performance |
| Timeline |
Dow Jones and Zhejiang Weixing Volatility Contrast
Predicted Return Density |
| Returns |
Dow Jones Industrial
Pair trading matchups for Dow Jones
Zhejiang Weixing New
Pair trading matchups for Zhejiang Weixing
Pair Trading with Dow Jones and Zhejiang Weixing
The main advantage of trading using opposite Dow Jones and Zhejiang Weixing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dow Jones position performs unexpectedly, Zhejiang Weixing 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 Weixing will offset losses from the drop in Zhejiang Weixing's long position.| Dow Jones vs. Vistra Energy Corp | Dow Jones vs. Fluence Energy | Dow Jones vs. Old Republic International | Dow Jones vs. Empresa Distribuidora y |
| Zhejiang Weixing vs. Agricultural Bank of | Zhejiang Weixing vs. Industrial and Commercial | Zhejiang Weixing vs. Bank of China | Zhejiang Weixing vs. China Construction Bank |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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