Correlation Between Dow Jones and Shengyi Technology
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By analyzing existing cross correlation between Dow Jones Industrial and Shengyi Technology Co, you can compare the effects of market volatilities on Dow Jones and Shengyi Technology 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 Shengyi Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dow Jones and Shengyi Technology.
Diversification Opportunities for Dow Jones and Shengyi Technology
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Dow and Shengyi is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Dow Jones Industrial and Shengyi Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shengyi Technology 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 Shengyi Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shengyi Technology has no effect on the direction of Dow Jones i.e., Dow Jones and Shengyi Technology go up and down completely randomly.
Pair Corralation between Dow Jones and Shengyi Technology
Assuming the 90 days trading horizon Dow Jones Industrial is expected to generate 0.31 times more return on investment than Shengyi Technology. However, Dow Jones Industrial is 3.19 times less risky than Shengyi Technology. It trades about 0.2 of its potential returns per unit of risk. Shengyi Technology Co is currently generating about -0.04 per unit of risk. If you would invest 4,201,159 in Dow Jones Industrial on September 3, 2024 and sell it today you would earn a total of 289,906 from holding Dow Jones Industrial or generate 6.9% 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. Shengyi Technology Co
Performance |
| Timeline |
Dow Jones and Shengyi Technology Volatility Contrast
Predicted Return Density |
| Returns |
Dow Jones Industrial
Pair trading matchups for Dow Jones
Shengyi Technology Co
Pair trading matchups for Shengyi Technology
Pair Trading with Dow Jones and Shengyi Technology
The main advantage of trading using opposite Dow Jones and Shengyi Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dow Jones position performs unexpectedly, Shengyi Technology 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 Shengyi Technology will offset losses from the drop in Shengyi Technology's long position.| Dow Jones vs. Eastern Co | Dow Jones vs. Uber Technologies | Dow Jones vs. AKITA Drilling | Dow Jones vs. Chemours Co |
| Shengyi Technology vs. Easyhome New Retail | Shengyi Technology vs. Yingde Greatchem Chemicals | Shengyi Technology vs. Ningxia Younglight Chemicals | Shengyi Technology vs. Beijing Jiaman Dress |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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