Correlation Between Dow Jones and Eventide Multi-asset
Can any of the company-specific risk be diversified away by investing in both Dow Jones and Eventide Multi-asset 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 Eventide Multi-asset 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 Eventide Multi Asset Income, you can compare the effects of market volatilities on Dow Jones and Eventide Multi-asset 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 Eventide Multi-asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dow Jones and Eventide Multi-asset.
Diversification Opportunities for Dow Jones and Eventide Multi-asset
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Dow and Eventide is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Dow Jones Industrial and Eventide Multi Asset Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eventide Multi Asset 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 Eventide Multi-asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eventide Multi Asset has no effect on the direction of Dow Jones i.e., Dow Jones and Eventide Multi-asset go up and down completely randomly.
Pair Corralation between Dow Jones and Eventide Multi-asset
Assuming the 90 days trading horizon Dow Jones Industrial is expected to generate 1.85 times more return on investment than Eventide Multi-asset. However, Dow Jones is 1.85 times more volatile than Eventide Multi Asset Income. It trades about 0.25 of its potential returns per unit of risk. Eventide Multi Asset Income is currently generating about 0.26 per unit of risk. If you would invest 4,238,757 in Dow Jones Industrial on August 29, 2024 and sell it today you would earn a total of 233,449 from holding Dow Jones Industrial or generate 5.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dow Jones Industrial vs. Eventide Multi Asset Income
Performance |
| Timeline |
Dow Jones and Eventide Multi-asset Volatility Contrast
Predicted Return Density |
| Returns |
Dow Jones Industrial
Pair trading matchups for Dow Jones
Eventide Multi Asset Income
Pair trading matchups for Eventide Multi-asset
Pair Trading with Dow Jones and Eventide Multi-asset
The main advantage of trading using opposite Dow Jones and Eventide Multi-asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dow Jones position performs unexpectedly, Eventide Multi-asset 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 Eventide Multi-asset will offset losses from the drop in Eventide Multi-asset's long position.| Dow Jones vs. Kaltura | Dow Jones vs. Artisan Partners Asset | Dow Jones vs. US Global Investors | Dow Jones vs. Analog Devices |
| Eventide Multi-asset vs. American Balanced Fund | Eventide Multi-asset vs. American Balanced Fund | Eventide Multi-asset vs. HUMANA INC | Eventide Multi-asset vs. Aquagold International |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
Other Complementary Tools
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation |