Correlation Between Dow Jones and Panda Financial
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By analyzing existing cross correlation between Dow Jones Industrial and Panda Financial Holding, you can compare the effects of market volatilities on Dow Jones and Panda Financial 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 Panda Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dow Jones and Panda Financial.
Diversification Opportunities for Dow Jones and Panda Financial
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Dow and Panda is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Dow Jones Industrial and Panda Financial Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Panda Financial Holding 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 Panda Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Panda Financial Holding has no effect on the direction of Dow Jones i.e., Dow Jones and Panda Financial go up and down completely randomly.
Pair Corralation between Dow Jones and Panda Financial
Assuming the 90 days trading horizon Dow Jones is expected to generate 5.09 times less return on investment than Panda Financial. But when comparing it to its historical volatility, Dow Jones Industrial is 3.54 times less risky than Panda Financial. It trades about 0.19 of its potential returns per unit of risk. Panda Financial Holding is currently generating about 0.27 of returns per unit of risk over similar time horizon. If you would invest 1,139 in Panda Financial Holding on August 24, 2024 and sell it today you would earn a total of 253.00 from holding Panda Financial Holding or generate 22.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dow Jones Industrial vs. Panda Financial Holding
Performance |
| Timeline |
Dow Jones and Panda Financial Volatility Contrast
Predicted Return Density |
| Returns |
Dow Jones Industrial
Pair trading matchups for Dow Jones
Panda Financial Holding
Pair trading matchups for Panda Financial
Pair Trading with Dow Jones and Panda Financial
The main advantage of trading using opposite Dow Jones and Panda Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dow Jones position performs unexpectedly, Panda Financial 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 Panda Financial will offset losses from the drop in Panda Financial's long position.| Dow Jones vs. Sphere Entertainment Co | Dow Jones vs. Perseus Mining Limited | Dow Jones vs. Titan Machinery | Dow Jones vs. Simon Property Group |
| Panda Financial vs. New China Life | Panda Financial vs. Ming Yang Smart | Panda Financial vs. 159005 | Panda Financial vs. Loctek Ergonomic Technology |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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