Correlation Between Dow Jones and Grupo Supervielle
Can any of the company-specific risk be diversified away by investing in both Dow Jones and Grupo Supervielle 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 Grupo Supervielle 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 Grupo Supervielle SA, you can compare the effects of market volatilities on Dow Jones and Grupo Supervielle 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 Grupo Supervielle. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dow Jones and Grupo Supervielle.
Diversification Opportunities for Dow Jones and Grupo Supervielle
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Dow and Grupo is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Dow Jones Industrial and Grupo Supervielle SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grupo Supervielle 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 Grupo Supervielle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grupo Supervielle has no effect on the direction of Dow Jones i.e., Dow Jones and Grupo Supervielle go up and down completely randomly.
Pair Corralation between Dow Jones and Grupo Supervielle
Assuming the 90 days trading horizon Dow Jones Industrial is expected to under-perform the Grupo Supervielle. But the index apears to be less risky and, when comparing its historical volatility, Dow Jones Industrial is 6.62 times less risky than Grupo Supervielle. The index trades about -0.21 of its potential returns per unit of risk. The Grupo Supervielle SA is currently generating about 0.42 of returns per unit of risk over similar time horizon. If you would invest 242,000 in Grupo Supervielle SA on September 25, 2024 and sell it today you would earn a total of 128,000 from holding Grupo Supervielle SA or generate 52.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Dow Jones Industrial vs. Grupo Supervielle SA
Performance |
| Timeline |
Dow Jones and Grupo Supervielle Volatility Contrast
Predicted Return Density |
| Returns |
Dow Jones Industrial
Pair trading matchups for Dow Jones
Grupo Supervielle SA
Pair trading matchups for Grupo Supervielle
Pair Trading with Dow Jones and Grupo Supervielle
The main advantage of trading using opposite Dow Jones and Grupo Supervielle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dow Jones position performs unexpectedly, Grupo Supervielle 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 Grupo Supervielle will offset losses from the drop in Grupo Supervielle's long position.| Dow Jones vs. Sabre Corpo | Dow Jones vs. Cannae Holdings | Dow Jones vs. Pekin Life Insurance | Dow Jones vs. Supercom |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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