Correlation Between Dow Jones and ANJI Technology
Can any of the company-specific risk be diversified away by investing in both Dow Jones and ANJI Technology at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Dow Jones and ANJI Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dow Jones Industrial and ANJI Technology Co, you can compare the effects of market volatilities on Dow Jones and ANJI 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 ANJI Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dow Jones and ANJI Technology.
Diversification Opportunities for Dow Jones and ANJI Technology
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Dow and ANJI is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Dow Jones Industrial and ANJI Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ANJI 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 ANJI Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ANJI Technology has no effect on the direction of Dow Jones i.e., Dow Jones and ANJI Technology go up and down completely randomly.
Pair Corralation between Dow Jones and ANJI Technology
Assuming the 90 days trading horizon Dow Jones Industrial is expected to generate 0.32 times more return on investment than ANJI Technology. However, Dow Jones Industrial is 3.12 times less risky than ANJI Technology. It trades about 0.27 of its potential returns per unit of risk. ANJI Technology Co is currently generating about -0.12 per unit of risk. If you would invest 4,223,305 in Dow Jones Industrial on August 30, 2024 and sell it today you would earn a total of 248,901 from holding Dow Jones Industrial or generate 5.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dow Jones Industrial vs. ANJI Technology Co
Performance |
| Timeline |
Dow Jones and ANJI Technology Volatility Contrast
Predicted Return Density |
| Returns |
Dow Jones Industrial
Pair trading matchups for Dow Jones
ANJI Technology Co
Pair trading matchups for ANJI Technology
Pair Trading with Dow Jones and ANJI Technology
The main advantage of trading using opposite Dow Jones and ANJI Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dow Jones position performs unexpectedly, ANJI 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 ANJI Technology will offset losses from the drop in ANJI Technology's long position.| Dow Jones vs. Skillful Craftsman Education | Dow Jones vs. Acco Brands | Dow Jones vs. Cracker Barrel Old | Dow Jones vs. Coursera |
| ANJI Technology vs. TSEC Corp | ANJI Technology vs. United Renewable Energy | ANJI Technology vs. Tainergy Tech Co | ANJI Technology vs. Motech Industries 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
Other Complementary Tools
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine |