Correlation Between Dow Jones and TAISEM
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By analyzing existing cross correlation between Dow Jones Industrial and TAISEM 45 22 APR 52, you can compare the effects of market volatilities on Dow Jones and TAISEM 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 TAISEM. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dow Jones and TAISEM.
Diversification Opportunities for Dow Jones and TAISEM
Very good diversification
The 3 months correlation between Dow and TAISEM is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Dow Jones Industrial and TAISEM 45 22 APR 52 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TAISEM 45 22 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 TAISEM. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TAISEM 45 22 has no effect on the direction of Dow Jones i.e., Dow Jones and TAISEM go up and down completely randomly.
Pair Corralation between Dow Jones and TAISEM
Assuming the 90 days trading horizon Dow Jones Industrial is expected to generate 0.33 times more return on investment than TAISEM. However, Dow Jones Industrial is 3.01 times less risky than TAISEM. It trades about 0.37 of its potential returns per unit of risk. TAISEM 45 22 APR 52 is currently generating about 0.09 per unit of risk. If you would invest 4,179,460 in Dow Jones Industrial on September 4, 2024 and sell it today you would earn a total of 298,740 from holding Dow Jones Industrial or generate 7.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 60.0% |
| Values | Daily Returns |
Dow Jones Industrial vs. TAISEM 45 22 APR 52
Performance |
| Timeline |
Dow Jones and TAISEM Volatility Contrast
Predicted Return Density |
| Returns |
Dow Jones Industrial
Pair trading matchups for Dow Jones
TAISEM 45 22 APR 52
Pair trading matchups for TAISEM
Pair Trading with Dow Jones and TAISEM
The main advantage of trading using opposite Dow Jones and TAISEM positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dow Jones position performs unexpectedly, TAISEM 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 TAISEM will offset losses from the drop in TAISEM's long position.| Dow Jones vs. Gentex | Dow Jones vs. American Axle Manufacturing | Dow Jones vs. Pearson PLC ADR | Dow Jones vs. Marine Products |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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