Correlation Between Dow Jones and Jaya Sukses
Can any of the company-specific risk be diversified away by investing in both Dow Jones and Jaya Sukses 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 Jaya Sukses 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 Jaya Sukses Makmur, you can compare the effects of market volatilities on Dow Jones and Jaya Sukses 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 Jaya Sukses. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dow Jones and Jaya Sukses.
Diversification Opportunities for Dow Jones and Jaya Sukses
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Dow and Jaya is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Dow Jones Industrial and Jaya Sukses Makmur in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jaya Sukses Makmur 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 Jaya Sukses. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jaya Sukses Makmur has no effect on the direction of Dow Jones i.e., Dow Jones and Jaya Sukses go up and down completely randomly.
Pair Corralation between Dow Jones and Jaya Sukses
Assuming the 90 days trading horizon Dow Jones Industrial is expected to under-perform the Jaya Sukses. But the index apears to be less risky and, when comparing its historical volatility, Dow Jones Industrial is 1.22 times less risky than Jaya Sukses. The index trades about -0.06 of its potential returns per unit of risk. The Jaya Sukses Makmur is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 99,000 in Jaya Sukses Makmur on October 23, 2024 and sell it today you would earn a total of 6,000 from holding Jaya Sukses Makmur or generate 6.06% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 94.87% |
Values | Daily Returns |
Dow Jones Industrial vs. Jaya Sukses Makmur
Performance |
Timeline |
Dow Jones and Jaya Sukses Volatility Contrast
Predicted Return Density |
Returns |
Dow Jones Industrial
Pair trading matchups for Dow Jones
Jaya Sukses Makmur
Pair trading matchups for Jaya Sukses
Pair Trading with Dow Jones and Jaya Sukses
The main advantage of trading using opposite Dow Jones and Jaya Sukses positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dow Jones position performs unexpectedly, Jaya Sukses 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 Jaya Sukses will offset losses from the drop in Jaya Sukses' long position.Dow Jones vs. Grupo Televisa SAB | Dow Jones vs. NiSource | Dow Jones vs. Kinetik Holdings | Dow Jones vs. Empresa Distribuidora y |
Jaya Sukses vs. Pollux Properti Indonesia | Jaya Sukses vs. MNC Studios International | Jaya Sukses vs. MAP Aktif Adiperkasa | Jaya Sukses vs. Trimitra Propertindo Tbk |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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