Correlation Between Dow Jones and Baywa AG
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By analyzing existing cross correlation between Dow Jones Industrial and Baywa AG Vink, you can compare the effects of market volatilities on Dow Jones and Baywa AG 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 Baywa AG. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dow Jones and Baywa AG.
Diversification Opportunities for Dow Jones and Baywa AG
Excellent diversification
The 3 months correlation between Dow and Baywa is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Dow Jones Industrial and Baywa AG Vink in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Baywa AG Vink 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 Baywa AG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Baywa AG Vink has no effect on the direction of Dow Jones i.e., Dow Jones and Baywa AG go up and down completely randomly.
Pair Corralation between Dow Jones and Baywa AG
Assuming the 90 days trading horizon Dow Jones is expected to generate 13.73 times less return on investment than Baywa AG. But when comparing it to its historical volatility, Dow Jones Industrial is 14.32 times less risky than Baywa AG. It trades about 0.11 of its potential returns per unit of risk. Baywa AG Vink is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 942.00 in Baywa AG Vink on October 21, 2024 and sell it today you would earn a total of 106.00 from holding Baywa AG Vink or generate 11.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 85.0% |
| Values | Daily Returns |
Dow Jones Industrial vs. Baywa AG Vink
Performance |
| Timeline |
Dow Jones and Baywa AG Volatility Contrast
Predicted Return Density |
| Returns |
Dow Jones Industrial
Pair trading matchups for Dow Jones
Baywa AG Vink
Pair trading matchups for Baywa AG
Pair Trading with Dow Jones and Baywa AG
The main advantage of trading using opposite Dow Jones and Baywa AG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dow Jones position performs unexpectedly, Baywa AG 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 Baywa AG will offset losses from the drop in Baywa AG's long position.| Dow Jones vs. SkyWest | Dow Jones vs. Air Transport Services | Dow Jones vs. LATAM Airlines Group | Dow Jones vs. Emerson Radio |
| Baywa AG vs. Samsung Electronics Co | Baywa AG vs. FUYO GENERAL LEASE | Baywa AG vs. Methode Electronics | Baywa AG vs. STMicroelectronics NV |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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