Correlation Between Dow Jones and Janus Growth
Can any of the company-specific risk be diversified away by investing in both Dow Jones and Janus Growth 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 Janus Growth 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 Janus Growth And, you can compare the effects of market volatilities on Dow Jones and Janus Growth 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 Janus Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dow Jones and Janus Growth.
Diversification Opportunities for Dow Jones and Janus Growth
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Dow and Janus is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Dow Jones Industrial and Janus Growth And in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Janus Growth And 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 Janus Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Janus Growth And has no effect on the direction of Dow Jones i.e., Dow Jones and Janus Growth go up and down completely randomly.
Pair Corralation between Dow Jones and Janus Growth
Assuming the 90 days trading horizon Dow Jones Industrial is expected to generate 0.74 times more return on investment than Janus Growth. However, Dow Jones Industrial is 1.36 times less risky than Janus Growth. It trades about 0.08 of its potential returns per unit of risk. Janus Growth And is currently generating about 0.02 per unit of risk. If you would invest 3,424,593 in Dow Jones Industrial on November 2, 2024 and sell it today you would earn a total of 1,063,620 from holding Dow Jones Industrial or generate 31.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Dow Jones Industrial vs. Janus Growth And
Performance |
| Timeline |
Dow Jones and Janus Growth Volatility Contrast
Predicted Return Density |
| Returns |
Dow Jones Industrial
Pair trading matchups for Dow Jones
Janus Growth And
Pair trading matchups for Janus Growth
Pair Trading with Dow Jones and Janus Growth
The main advantage of trading using opposite Dow Jones and Janus Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dow Jones position performs unexpectedly, Janus Growth 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 Janus Growth will offset losses from the drop in Janus Growth's long position.| Dow Jones vs. Cincinnati Financial | Dow Jones vs. Kellanova | Dow Jones vs. Acme United | Dow Jones vs. Procter Gamble |
| Janus Growth vs. Janus Enterprise Fund | Janus Growth vs. Siit Dynamic Asset | Janus Growth vs. Columbia Large Cap | Janus Growth vs. Siit Large Cap |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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