Correlation Between Dow Jones and CSIF III
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By analyzing existing cross correlation between Dow Jones Industrial and CSIF III Equity, you can compare the effects of market volatilities on Dow Jones and CSIF III 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 CSIF III. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dow Jones and CSIF III.
Diversification Opportunities for Dow Jones and CSIF III
Poor diversification
The 3 months correlation between Dow and CSIF is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Dow Jones Industrial and CSIF III Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CSIF III Equity 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 CSIF III. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CSIF III Equity has no effect on the direction of Dow Jones i.e., Dow Jones and CSIF III go up and down completely randomly.
Pair Corralation between Dow Jones and CSIF III
Assuming the 90 days trading horizon Dow Jones Industrial is expected to generate 1.51 times more return on investment than CSIF III. However, Dow Jones is 1.51 times more volatile than CSIF III Equity. It trades about 0.29 of its potential returns per unit of risk. CSIF III Equity is currently generating about 0.28 per unit of risk. If you would invest 4,270,656 in Dow Jones Industrial on November 7, 2024 and sell it today you would earn a total of 184,948 from holding Dow Jones Industrial or generate 4.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Dow Jones Industrial vs. CSIF III Equity
Performance |
| Timeline |
Dow Jones and CSIF III Volatility Contrast
Predicted Return Density |
| Returns |
Dow Jones Industrial
Pair trading matchups for Dow Jones
CSIF III Equity
Pair trading matchups for CSIF III
Pair Trading with Dow Jones and CSIF III
The main advantage of trading using opposite Dow Jones and CSIF III positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dow Jones position performs unexpectedly, CSIF III 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 CSIF III will offset losses from the drop in CSIF III's long position.| Dow Jones vs. Viemed Healthcare | Dow Jones vs. Alphatec Holdings | Dow Jones vs. Tandem Diabetes Care | Dow Jones vs. Alvotech |
| CSIF III vs. SPDR Dow Jones | CSIF III vs. Baloise Holding AG | CSIF III vs. Autoneum Holding AG | CSIF III vs. SPDR FTSE UK |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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