Correlation Between Dow Jones and TKS Technologies
Can any of the company-specific risk be diversified away by investing in both Dow Jones and TKS Technologies 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 TKS Technologies 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 TKS Technologies Public, you can compare the effects of market volatilities on Dow Jones and TKS Technologies 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 TKS Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dow Jones and TKS Technologies.
Diversification Opportunities for Dow Jones and TKS Technologies
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Dow and TKS is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Dow Jones Industrial and TKS Technologies Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TKS Technologies Public 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 TKS Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TKS Technologies Public has no effect on the direction of Dow Jones i.e., Dow Jones and TKS Technologies go up and down completely randomly.
Pair Corralation between Dow Jones and TKS Technologies
Assuming the 90 days trading horizon Dow Jones Industrial is expected to generate 0.69 times more return on investment than TKS Technologies. However, Dow Jones Industrial is 1.45 times less risky than TKS Technologies. It trades about 0.29 of its potential returns per unit of risk. TKS Technologies Public is currently generating about -0.37 per unit of risk. If you would invest 4,273,213 in Dow Jones Industrial on November 4, 2024 and sell it today you would earn a total of 181,253 from holding Dow Jones Industrial or generate 4.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 90.91% |
| Values | Daily Returns |
Dow Jones Industrial vs. TKS Technologies Public
Performance |
| Timeline |
Dow Jones and TKS Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Dow Jones Industrial
Pair trading matchups for Dow Jones
TKS Technologies Public
Pair trading matchups for TKS Technologies
Pair Trading with Dow Jones and TKS Technologies
The main advantage of trading using opposite Dow Jones and TKS Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dow Jones position performs unexpectedly, TKS Technologies 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 TKS Technologies will offset losses from the drop in TKS Technologies' long position.| Dow Jones vs. Rambler Metals and | Dow Jones vs. Nicola Mining | Dow Jones vs. Old Dominion Freight | Dow Jones vs. United Guardian |
| TKS Technologies vs. Synnex Public | TKS Technologies vs. SiS Distribution Public | TKS Technologies vs. Thoresen Thai Agencies | TKS Technologies vs. SVI Public |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
Other Complementary Tools
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance |