Correlation Between Dow Jones and 50247VAC3
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By analyzing existing cross correlation between Dow Jones Industrial and LYB INTL FIN, you can compare the effects of market volatilities on Dow Jones and 50247VAC3 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 50247VAC3. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dow Jones and 50247VAC3.
Diversification Opportunities for Dow Jones and 50247VAC3
Excellent diversification
The 3 months correlation between Dow and 50247VAC3 is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Dow Jones Industrial and LYB INTL FIN in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LYB INTL FIN 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 50247VAC3. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LYB INTL FIN has no effect on the direction of Dow Jones i.e., Dow Jones and 50247VAC3 go up and down completely randomly.
Pair Corralation between Dow Jones and 50247VAC3
Assuming the 90 days trading horizon Dow Jones Industrial is expected to generate 0.44 times more return on investment than 50247VAC3. However, Dow Jones Industrial is 2.28 times less risky than 50247VAC3. It trades about 0.29 of its potential returns per unit of risk. LYB INTL FIN is currently generating about -0.03 per unit of risk. If you would invest 4,214,154 in Dow Jones Industrial on August 31, 2024 and sell it today you would earn a total of 258,052 from holding Dow Jones Industrial or generate 6.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 86.36% |
| Values | Daily Returns |
Dow Jones Industrial vs. LYB INTL FIN
Performance |
| Timeline |
Dow Jones and 50247VAC3 Volatility Contrast
Predicted Return Density |
| Returns |
Dow Jones Industrial
Pair trading matchups for Dow Jones
LYB INTL FIN
Pair trading matchups for 50247VAC3
Pair Trading with Dow Jones and 50247VAC3
The main advantage of trading using opposite Dow Jones and 50247VAC3 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dow Jones position performs unexpectedly, 50247VAC3 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 50247VAC3 will offset losses from the drop in 50247VAC3's long position.| Dow Jones vs. Aerofoam Metals | Dow Jones vs. ACG Metals Limited | Dow Jones vs. China Clean Energy | Dow Jones vs. Fast Retailing Co |
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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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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