Correlation Between Dow Jones and EASY HOLDINGS
Can any of the company-specific risk be diversified away by investing in both Dow Jones and EASY HOLDINGS at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Dow Jones and EASY HOLDINGS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dow Jones Industrial and EASY HOLDINGS Co, you can compare the effects of market volatilities on Dow Jones and EASY HOLDINGS 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 EASY HOLDINGS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dow Jones and EASY HOLDINGS.
Diversification Opportunities for Dow Jones and EASY HOLDINGS
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Dow and EASY is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Dow Jones Industrial and EASY HOLDINGS Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EASY HOLDINGS 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 EASY HOLDINGS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EASY HOLDINGS has no effect on the direction of Dow Jones i.e., Dow Jones and EASY HOLDINGS go up and down completely randomly.
Pair Corralation between Dow Jones and EASY HOLDINGS
Assuming the 90 days trading horizon Dow Jones Industrial is expected to generate 0.44 times more return on investment than EASY HOLDINGS. However, Dow Jones Industrial is 2.28 times less risky than EASY HOLDINGS. It trades about 0.08 of its potential returns per unit of risk. EASY HOLDINGS Co is currently generating about 0.0 per unit of risk. If you would invest 3,378,148 in Dow Jones Industrial on August 29, 2024 and sell it today you would earn a total of 1,107,883 from holding Dow Jones Industrial or generate 32.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 97.37% |
| Values | Daily Returns |
Dow Jones Industrial vs. EASY HOLDINGS Co
Performance |
| Timeline |
Dow Jones and EASY HOLDINGS Volatility Contrast
Predicted Return Density |
| Returns |
Dow Jones Industrial
Pair trading matchups for Dow Jones
EASY HOLDINGS Co
Pair trading matchups for EASY HOLDINGS
Pair Trading with Dow Jones and EASY HOLDINGS
The main advantage of trading using opposite Dow Jones and EASY HOLDINGS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dow Jones position performs unexpectedly, EASY HOLDINGS 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 EASY HOLDINGS will offset losses from the drop in EASY HOLDINGS's long position.| Dow Jones vs. CECO Environmental Corp | Dow Jones vs. Western Acquisition Ventures | Dow Jones vs. Tyson Foods | Dow Jones vs. Inflection Point Acquisition |
| EASY HOLDINGS vs. AptaBio Therapeutics | EASY HOLDINGS vs. Daewoo SBI SPAC | EASY HOLDINGS vs. Dream Security co | EASY HOLDINGS vs. Microfriend |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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