Correlation Between Dow Jones and LUXOR-B
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By analyzing existing cross correlation between Dow Jones Industrial and Investeringsselskabet Luxor AS, you can compare the effects of market volatilities on Dow Jones and LUXOR-B 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 LUXOR-B. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dow Jones and LUXOR-B.
Diversification Opportunities for Dow Jones and LUXOR-B
Very good diversification
The 3 months correlation between Dow and LUXOR-B is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Dow Jones Industrial and Investeringsselskabet Luxor AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Investeringsselskabet 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 LUXOR-B. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Investeringsselskabet has no effect on the direction of Dow Jones i.e., Dow Jones and LUXOR-B go up and down completely randomly.
Pair Corralation between Dow Jones and LUXOR-B
Assuming the 90 days trading horizon Dow Jones is expected to generate 4.65 times less return on investment than LUXOR-B. But when comparing it to its historical volatility, Dow Jones Industrial is 2.69 times less risky than LUXOR-B. It trades about 0.1 of its potential returns per unit of risk. Investeringsselskabet Luxor AS is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 58,000 in Investeringsselskabet Luxor AS on October 26, 2024 and sell it today you would earn a total of 14,500 from holding Investeringsselskabet Luxor AS or generate 25.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 98.33% |
| Values | Daily Returns |
Dow Jones Industrial vs. Investeringsselskabet Luxor AS
Performance |
| Timeline |
Dow Jones and LUXOR-B Volatility Contrast
Predicted Return Density |
| Returns |
Dow Jones Industrial
Pair trading matchups for Dow Jones
Investeringsselskabet Luxor AS
Pair trading matchups for LUXOR-B
Pair Trading with Dow Jones and LUXOR-B
The main advantage of trading using opposite Dow Jones and LUXOR-B positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dow Jones position performs unexpectedly, LUXOR-B 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 LUXOR-B will offset losses from the drop in LUXOR-B's long position.| Dow Jones vs. Asure Software | Dow Jones vs. Amkor Technology | Dow Jones vs. Radcom | Dow Jones vs. Senmiao Technology |
| LUXOR-B vs. Skjern Bank AS | LUXOR-B vs. Groenlandsbanken AS | LUXOR-B vs. Fynske Bank AS | LUXOR-B vs. Lollands Bank |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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