Correlation Between Dow Jones and Amg Managers
Can any of the company-specific risk be diversified away by investing in both Dow Jones and Amg Managers 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 Amg Managers 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 Amg Managers Montag, you can compare the effects of market volatilities on Dow Jones and Amg Managers 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 Amg Managers. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dow Jones and Amg Managers.
Diversification Opportunities for Dow Jones and Amg Managers
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Dow and Amg is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Dow Jones Industrial and Amg Managers Montag in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amg Managers Montag 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 Amg Managers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amg Managers Montag has no effect on the direction of Dow Jones i.e., Dow Jones and Amg Managers go up and down completely randomly.
Pair Corralation between Dow Jones and Amg Managers
Assuming the 90 days trading horizon Dow Jones Industrial is expected to generate 0.71 times more return on investment than Amg Managers. However, Dow Jones Industrial is 1.41 times less risky than Amg Managers. It trades about 0.12 of its potential returns per unit of risk. Amg Managers Montag is currently generating about 0.07 per unit of risk. If you would invest 3,464,197 in Dow Jones Industrial on August 29, 2024 and sell it today you would earn a total of 1,008,009 from holding Dow Jones Industrial or generate 29.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dow Jones Industrial vs. Amg Managers Montag
Performance |
| Timeline |
Dow Jones and Amg Managers Volatility Contrast
Predicted Return Density |
| Returns |
Dow Jones Industrial
Pair trading matchups for Dow Jones
Amg Managers Montag
Pair trading matchups for Amg Managers
Pair Trading with Dow Jones and Amg Managers
The main advantage of trading using opposite Dow Jones and Amg Managers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dow Jones position performs unexpectedly, Amg Managers 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 Amg Managers will offset losses from the drop in Amg Managers' long position.| Dow Jones vs. Kaltura | Dow Jones vs. Artisan Partners Asset | Dow Jones vs. US Global Investors | Dow Jones vs. Analog Devices |
| Amg Managers vs. Growth Fund Of | Amg Managers vs. HUMANA INC | Amg Managers vs. Aquagold International | Amg Managers vs. Barloworld Ltd ADR |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
Other Complementary Tools
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Bonds Directory Find actively traded corporate debentures issued by US companies |