Correlation Between Dow Jones and Arkha Jayanti
Can any of the company-specific risk be diversified away by investing in both Dow Jones and Arkha Jayanti 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 Arkha Jayanti 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 Arkha Jayanti Persada, you can compare the effects of market volatilities on Dow Jones and Arkha Jayanti 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 Arkha Jayanti. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dow Jones and Arkha Jayanti.
Diversification Opportunities for Dow Jones and Arkha Jayanti
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Dow and Arkha is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Dow Jones Industrial and Arkha Jayanti Persada in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Arkha Jayanti Persada 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 Arkha Jayanti. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Arkha Jayanti Persada has no effect on the direction of Dow Jones i.e., Dow Jones and Arkha Jayanti go up and down completely randomly.
Pair Corralation between Dow Jones and Arkha Jayanti
Assuming the 90 days trading horizon Dow Jones Industrial is expected to generate 0.19 times more return on investment than Arkha Jayanti. However, Dow Jones Industrial is 5.32 times less risky than Arkha Jayanti. It trades about 0.09 of its potential returns per unit of risk. Arkha Jayanti Persada is currently generating about -0.03 per unit of risk. If you would invest 3,320,222 in Dow Jones Industrial on September 5, 2024 and sell it today you would earn a total of 1,150,331 from holding Dow Jones Industrial or generate 34.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.56% |
| Values | Daily Returns |
Dow Jones Industrial vs. Arkha Jayanti Persada
Performance |
| Timeline |
Dow Jones and Arkha Jayanti Volatility Contrast
Predicted Return Density |
| Returns |
Dow Jones Industrial
Pair trading matchups for Dow Jones
Arkha Jayanti Persada
Pair trading matchups for Arkha Jayanti
Pair Trading with Dow Jones and Arkha Jayanti
The main advantage of trading using opposite Dow Jones and Arkha Jayanti positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dow Jones position performs unexpectedly, Arkha Jayanti 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 Arkha Jayanti will offset losses from the drop in Arkha Jayanti's long position.| Dow Jones vs. Shake Shack | Dow Jones vs. Artisan Partners Asset | Dow Jones vs. Dave Busters Entertainment | Dow Jones vs. Meli Hotels International |
| Arkha Jayanti vs. Berkah Prima Perkasa | Arkha Jayanti vs. Jasnita Telekomindo Tbk | Arkha Jayanti vs. Darmi Bersaudara Tbk | Arkha Jayanti vs. Agro Yasa Lestari |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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