Correlation Between Dow Jones and Astrana Health
Can any of the company-specific risk be diversified away by investing in both Dow Jones and Astrana Health 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 Astrana Health 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 Astrana Health, you can compare the effects of market volatilities on Dow Jones and Astrana Health 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 Astrana Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dow Jones and Astrana Health.
Diversification Opportunities for Dow Jones and Astrana Health
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Dow and Astrana is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Dow Jones Industrial and Astrana Health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Astrana Health 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 Astrana Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Astrana Health has no effect on the direction of Dow Jones i.e., Dow Jones and Astrana Health go up and down completely randomly.
Pair Corralation between Dow Jones and Astrana Health
Assuming the 90 days trading horizon Dow Jones is expected to generate 1.79 times less return on investment than Astrana Health. But when comparing it to its historical volatility, Dow Jones Industrial is 4.2 times less risky than Astrana Health. It trades about 0.12 of its potential returns per unit of risk. Astrana Health is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 3,296 in Astrana Health on September 4, 2024 and sell it today you would earn a total of 1,025 from holding Astrana Health or generate 31.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dow Jones Industrial vs. Astrana Health
Performance |
| Timeline |
Dow Jones and Astrana Health Volatility Contrast
Predicted Return Density |
| Returns |
Dow Jones Industrial
Pair trading matchups for Dow Jones
Astrana Health
Pair trading matchups for Astrana Health
Pair Trading with Dow Jones and Astrana Health
The main advantage of trading using opposite Dow Jones and Astrana Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dow Jones position performs unexpectedly, Astrana Health 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 Astrana Health will offset losses from the drop in Astrana Health's long position.| Dow Jones vs. Gentex | Dow Jones vs. American Axle Manufacturing | Dow Jones vs. Pearson PLC ADR | Dow Jones vs. Marine Products |
| Astrana Health vs. Turning Point Brands | Astrana Health vs. Altria Group | Astrana Health vs. Willamette Valley Vineyards | Astrana Health vs. Accel Entertainment |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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