Correlation Between Dow Jones and CI Signature
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By analyzing existing cross correlation between Dow Jones Industrial and CI Signature Cat, you can compare the effects of market volatilities on Dow Jones and CI Signature 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 CI Signature. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dow Jones and CI Signature.
Diversification Opportunities for Dow Jones and CI Signature
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Dow and 0P0001FKWD is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Dow Jones Industrial and CI Signature Cat in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CI Signature Cat 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 CI Signature. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CI Signature Cat has no effect on the direction of Dow Jones i.e., Dow Jones and CI Signature go up and down completely randomly.
Pair Corralation between Dow Jones and CI Signature
Assuming the 90 days trading horizon Dow Jones is expected to generate 1.85 times less return on investment than CI Signature. But when comparing it to its historical volatility, Dow Jones Industrial is 1.64 times less risky than CI Signature. It trades about 0.25 of its potential returns per unit of risk. CI Signature Cat is currently generating about 0.28 of returns per unit of risk over similar time horizon. If you would invest 3,326 in CI Signature Cat on August 29, 2024 and sell it today you would earn a total of 327.00 from holding CI Signature Cat or generate 9.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Dow Jones Industrial vs. CI Signature Cat
Performance |
| Timeline |
Dow Jones and CI Signature Volatility Contrast
Predicted Return Density |
| Returns |
Dow Jones Industrial
Pair trading matchups for Dow Jones
CI Signature Cat
Pair trading matchups for CI Signature
Pair Trading with Dow Jones and CI Signature
The main advantage of trading using opposite Dow Jones and CI Signature positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dow Jones position performs unexpectedly, CI Signature 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 CI Signature will offset losses from the drop in CI Signature's long position.| Dow Jones vs. Kaltura | Dow Jones vs. Artisan Partners Asset | Dow Jones vs. US Global Investors | Dow Jones vs. Analog Devices |
| CI Signature vs. Fidelity Tactical High | CI Signature vs. Fidelity ClearPath 2045 | CI Signature vs. Bloom Select Income | CI Signature vs. Global Healthcare Income |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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