Correlation Between Dow Jones and Jiangxi Lianchuang
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By analyzing existing cross correlation between Dow Jones Industrial and Jiangxi Lianchuang Opto electronic, you can compare the effects of market volatilities on Dow Jones and Jiangxi Lianchuang 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 Jiangxi Lianchuang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dow Jones and Jiangxi Lianchuang.
Diversification Opportunities for Dow Jones and Jiangxi Lianchuang
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Dow and Jiangxi is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Dow Jones Industrial and Jiangxi Lianchuang Opto electr in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiangxi Lianchuang Opto 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 Jiangxi Lianchuang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiangxi Lianchuang Opto has no effect on the direction of Dow Jones i.e., Dow Jones and Jiangxi Lianchuang go up and down completely randomly.
Pair Corralation between Dow Jones and Jiangxi Lianchuang
Assuming the 90 days trading horizon Dow Jones is expected to generate 23.24 times less return on investment than Jiangxi Lianchuang. But when comparing it to its historical volatility, Dow Jones Industrial is 7.64 times less risky than Jiangxi Lianchuang. It trades about 0.01 of its potential returns per unit of risk. Jiangxi Lianchuang Opto electronic is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 4,337 in Jiangxi Lianchuang Opto electronic on September 19, 2024 and sell it today you would earn a total of 103.00 from holding Jiangxi Lianchuang Opto electronic or generate 2.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Dow Jones Industrial vs. Jiangxi Lianchuang Opto electr
Performance |
| Timeline |
Dow Jones and Jiangxi Lianchuang Volatility Contrast
Predicted Return Density |
| Returns |
Dow Jones Industrial
Pair trading matchups for Dow Jones
Jiangxi Lianchuang Opto electronic
Pair trading matchups for Jiangxi Lianchuang
Pair Trading with Dow Jones and Jiangxi Lianchuang
The main advantage of trading using opposite Dow Jones and Jiangxi Lianchuang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dow Jones position performs unexpectedly, Jiangxi Lianchuang 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 Jiangxi Lianchuang will offset losses from the drop in Jiangxi Lianchuang's long position.| Dow Jones vs. Mangazeya Mining | Dow Jones vs. Summit Materials | Dow Jones vs. Perseus Mining Limited | Dow Jones vs. AMCON Distributing |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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