Correlation Between Dow Jones and Guggenheim Macro
Can any of the company-specific risk be diversified away by investing in both Dow Jones and Guggenheim Macro 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 Guggenheim Macro 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 Guggenheim Macro Opportunities, you can compare the effects of market volatilities on Dow Jones and Guggenheim Macro 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 Guggenheim Macro. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dow Jones and Guggenheim Macro.
Diversification Opportunities for Dow Jones and Guggenheim Macro
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Dow and Guggenheim is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Dow Jones Industrial and Guggenheim Macro Opportunities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guggenheim Macro Opp 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 Guggenheim Macro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guggenheim Macro Opp has no effect on the direction of Dow Jones i.e., Dow Jones and Guggenheim Macro go up and down completely randomly.
Pair Corralation between Dow Jones and Guggenheim Macro
Assuming the 90 days trading horizon Dow Jones Industrial is expected to generate 8.71 times more return on investment than Guggenheim Macro. However, Dow Jones is 8.71 times more volatile than Guggenheim Macro Opportunities. It trades about 0.26 of its potential returns per unit of risk. Guggenheim Macro Opportunities is currently generating about 0.29 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 247,274 from holding Dow Jones Industrial or generate 5.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Dow Jones Industrial vs. Guggenheim Macro Opportunities
Performance |
| Timeline |
Dow Jones and Guggenheim Macro Volatility Contrast
Predicted Return Density |
| Returns |
Dow Jones Industrial
Pair trading matchups for Dow Jones
Guggenheim Macro Opportunities
Pair trading matchups for Guggenheim Macro
Pair Trading with Dow Jones and Guggenheim Macro
The main advantage of trading using opposite Dow Jones and Guggenheim Macro positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dow Jones position performs unexpectedly, Guggenheim Macro 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 Guggenheim Macro will offset losses from the drop in Guggenheim Macro's long position.| Dow Jones vs. Kaltura | Dow Jones vs. Artisan Partners Asset | Dow Jones vs. US Global Investors | Dow Jones vs. Analog Devices |
| Guggenheim Macro vs. Nasdaq 100 Index Fund | Guggenheim Macro vs. Artisan Thematic Fund | Guggenheim Macro vs. Growth Fund Of | Guggenheim Macro vs. Eic Value Fund |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
Other Complementary Tools
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine |