Correlation Between Dow Jones and Clever Leaves
Can any of the company-specific risk be diversified away by investing in both Dow Jones and Clever Leaves 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 Clever Leaves 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 Clever Leaves Holdings, you can compare the effects of market volatilities on Dow Jones and Clever Leaves 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 Clever Leaves. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dow Jones and Clever Leaves.
Diversification Opportunities for Dow Jones and Clever Leaves
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Dow and Clever is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Dow Jones Industrial and Clever Leaves Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Clever Leaves Holdings 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 Clever Leaves. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Clever Leaves Holdings has no effect on the direction of Dow Jones i.e., Dow Jones and Clever Leaves go up and down completely randomly.
Pair Corralation between Dow Jones and Clever Leaves
If you would invest 3,620,444 in Dow Jones Industrial on August 29, 2024 and sell it today you would earn a total of 865,587 from holding Dow Jones Industrial or generate 23.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 0.4% |
| Values | Daily Returns |
Dow Jones Industrial vs. Clever Leaves Holdings
Performance |
| Timeline |
Dow Jones and Clever Leaves Volatility Contrast
Predicted Return Density |
| Returns |
Dow Jones Industrial
Pair trading matchups for Dow Jones
Clever Leaves Holdings
Pair trading matchups for Clever Leaves
Pair Trading with Dow Jones and Clever Leaves
The main advantage of trading using opposite Dow Jones and Clever Leaves positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dow Jones position performs unexpectedly, Clever Leaves 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 Clever Leaves will offset losses from the drop in Clever Leaves' long position.| Dow Jones vs. Kaltura | Dow Jones vs. Artisan Partners Asset | Dow Jones vs. US Global Investors | Dow Jones vs. Analog Devices |
| Clever Leaves vs. Clever Leaves Holdings | Clever Leaves vs. CannBioRx Life Sciences | Clever Leaves vs. Clene Inc | Clever Leaves vs. CuriosityStream |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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