Correlation Between Dow Jones and Kontrol Technologies
Can any of the company-specific risk be diversified away by investing in both Dow Jones and Kontrol Technologies 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 Kontrol Technologies 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 Kontrol Technologies Corp, you can compare the effects of market volatilities on Dow Jones and Kontrol Technologies 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 Kontrol Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dow Jones and Kontrol Technologies.
Diversification Opportunities for Dow Jones and Kontrol Technologies
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Dow and Kontrol is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Dow Jones Industrial and Kontrol Technologies Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kontrol Technologies Corp 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 Kontrol Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kontrol Technologies Corp has no effect on the direction of Dow Jones i.e., Dow Jones and Kontrol Technologies go up and down completely randomly.
Pair Corralation between Dow Jones and Kontrol Technologies
Assuming the 90 days trading horizon Dow Jones Industrial is expected to generate 0.11 times more return on investment than Kontrol Technologies. However, Dow Jones Industrial is 9.01 times less risky than Kontrol Technologies. It trades about 0.16 of its potential returns per unit of risk. Kontrol Technologies Corp is currently generating about 0.0 per unit of risk. If you would invest 3,871,129 in Dow Jones Industrial on September 2, 2024 and sell it today you would earn a total of 619,936 from holding Dow Jones Industrial or generate 16.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dow Jones Industrial vs. Kontrol Technologies Corp
Performance |
| Timeline |
Dow Jones and Kontrol Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Dow Jones Industrial
Pair trading matchups for Dow Jones
Kontrol Technologies Corp
Pair trading matchups for Kontrol Technologies
Pair Trading with Dow Jones and Kontrol Technologies
The main advantage of trading using opposite Dow Jones and Kontrol Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dow Jones position performs unexpectedly, Kontrol Technologies 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 Kontrol Technologies will offset losses from the drop in Kontrol Technologies' long position.| Dow Jones vs. Dream Finders Homes | Dow Jones vs. GEN Restaurant Group, | Dow Jones vs. National Beverage Corp | Dow Jones vs. BJs Restaurants |
| Kontrol Technologies vs. SEATech Ventures Corp | Kontrol Technologies vs. Xalles Holdings | Kontrol Technologies vs. GBT Technologies | Kontrol Technologies vs. Quisitive Technology Solutions |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
Other Complementary Tools
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios |