Correlation Between Dow Jones and NPF MICRO
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By analyzing existing cross correlation between Dow Jones Industrial and NPF MICRO FINANCE, you can compare the effects of market volatilities on Dow Jones and NPF MICRO 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 NPF MICRO. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dow Jones and NPF MICRO.
Diversification Opportunities for Dow Jones and NPF MICRO
Excellent diversification
The 3 months correlation between Dow and NPF is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Dow Jones Industrial and NPF MICRO FINANCE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NPF MICRO FINANCE 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 NPF MICRO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NPF MICRO FINANCE has no effect on the direction of Dow Jones i.e., Dow Jones and NPF MICRO go up and down completely randomly.
Pair Corralation between Dow Jones and NPF MICRO
Assuming the 90 days trading horizon Dow Jones Industrial is expected to generate 0.24 times more return on investment than NPF MICRO. However, Dow Jones Industrial is 4.2 times less risky than NPF MICRO. It trades about 0.13 of its potential returns per unit of risk. NPF MICRO FINANCE is currently generating about -0.02 per unit of risk. If you would invest 3,624,787 in Dow Jones Industrial on September 3, 2024 and sell it today you would earn a total of 853,413 from holding Dow Jones Industrial or generate 23.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 98.38% |
| Values | Daily Returns |
Dow Jones Industrial vs. NPF MICRO FINANCE
Performance |
| Timeline |
Dow Jones and NPF MICRO Volatility Contrast
Predicted Return Density |
| Returns |
Dow Jones Industrial
Pair trading matchups for Dow Jones
NPF MICRO FINANCE
Pair trading matchups for NPF MICRO
Pair Trading with Dow Jones and NPF MICRO
The main advantage of trading using opposite Dow Jones and NPF MICRO positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dow Jones position performs unexpectedly, NPF MICRO 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 NPF MICRO will offset losses from the drop in NPF MICRO's long position.| Dow Jones vs. Eastern Co | Dow Jones vs. Uber Technologies | Dow Jones vs. AKITA Drilling | Dow Jones vs. Chemours Co |
| NPF MICRO vs. ASO SAVINGS AND | NPF MICRO vs. STERLING FINANCIAL HOLDINGS | NPF MICRO vs. SECURE ELECTRONIC TECHNOLOGY | NPF MICRO vs. ZENITH BANK PLC |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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