Correlation Between Dow Jones and Lecron Energy
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By analyzing existing cross correlation between Dow Jones Industrial and Lecron Energy Saving, you can compare the effects of market volatilities on Dow Jones and Lecron Energy 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 Lecron Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dow Jones and Lecron Energy.
Diversification Opportunities for Dow Jones and Lecron Energy
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Dow and Lecron is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Dow Jones Industrial and Lecron Energy Saving in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lecron Energy Saving 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 Lecron Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lecron Energy Saving has no effect on the direction of Dow Jones i.e., Dow Jones and Lecron Energy go up and down completely randomly.
Pair Corralation between Dow Jones and Lecron Energy
Assuming the 90 days trading horizon Dow Jones Industrial is expected to generate 0.29 times more return on investment than Lecron Energy. However, Dow Jones Industrial is 3.51 times less risky than Lecron Energy. It trades about -0.21 of its potential returns per unit of risk. Lecron Energy Saving is currently generating about -0.44 per unit of risk. If you would invest 4,414,856 in Dow Jones Industrial on October 12, 2024 and sell it today you would lose (151,336) from holding Dow Jones Industrial or give up 3.43% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dow Jones Industrial vs. Lecron Energy Saving
Performance |
| Timeline |
Dow Jones and Lecron Energy Volatility Contrast
Predicted Return Density |
| Returns |
Dow Jones Industrial
Pair trading matchups for Dow Jones
Lecron Energy Saving
Pair trading matchups for Lecron Energy
Pair Trading with Dow Jones and Lecron Energy
The main advantage of trading using opposite Dow Jones and Lecron Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dow Jones position performs unexpectedly, Lecron Energy 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 Lecron Energy will offset losses from the drop in Lecron Energy's long position.| Dow Jones vs. Toro | Dow Jones vs. Foot Locker | Dow Jones vs. Abercrombie Fitch | Dow Jones vs. 51Talk Online Education |
| Lecron Energy vs. Hunan Investment Group | Lecron Energy vs. Zhongrun Resources Investment | Lecron Energy vs. Beijing Mainstreets Investment | Lecron Energy vs. Allwin Telecommunication Co |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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