Correlation Between Dow Jones and 98389BAN0
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By analyzing existing cross correlation between Dow Jones Industrial and XCEL ENERGY INC, you can compare the effects of market volatilities on Dow Jones and 98389BAN0 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 98389BAN0. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dow Jones and 98389BAN0.
Diversification Opportunities for Dow Jones and 98389BAN0
Significant diversification
The 3 months correlation between Dow and 98389BAN0 is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Dow Jones Industrial and XCEL ENERGY INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on XCEL ENERGY INC 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 98389BAN0. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of XCEL ENERGY INC has no effect on the direction of Dow Jones i.e., Dow Jones and 98389BAN0 go up and down completely randomly.
Pair Corralation between Dow Jones and 98389BAN0
Assuming the 90 days trading horizon Dow Jones Industrial is expected to generate 0.8 times more return on investment than 98389BAN0. However, Dow Jones Industrial is 1.25 times less risky than 98389BAN0. It trades about 0.29 of its potential returns per unit of risk. XCEL ENERGY INC is currently generating about -0.19 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 Together |
| Strength | Insignificant |
| Accuracy | 54.55% |
| Values | Daily Returns |
Dow Jones Industrial vs. XCEL ENERGY INC
Performance |
| Timeline |
Dow Jones and 98389BAN0 Volatility Contrast
Predicted Return Density |
| Returns |
Dow Jones Industrial
Pair trading matchups for Dow Jones
XCEL ENERGY INC
Pair trading matchups for 98389BAN0
Pair Trading with Dow Jones and 98389BAN0
The main advantage of trading using opposite Dow Jones and 98389BAN0 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dow Jones position performs unexpectedly, 98389BAN0 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 98389BAN0 will offset losses from the drop in 98389BAN0'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 |
| 98389BAN0 vs. AEP TEX INC | 98389BAN0 vs. US BANK NATIONAL | 98389BAN0 vs. International Business Machines | 98389BAN0 vs. Intel |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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