Correlation Between Glaukos Corp and Dow Jones
Can any of the company-specific risk be diversified away by investing in both Glaukos Corp and Dow Jones 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 Glaukos Corp and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Glaukos Corp and Dow Jones Industrial, you can compare the effects of market volatilities on Glaukos Corp and Dow Jones 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 Glaukos Corp with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of Glaukos Corp and Dow Jones.
Diversification Opportunities for Glaukos Corp and Dow Jones
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Glaukos and Dow is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Glaukos Corp and Dow Jones Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dow Jones Industrial and Glaukos Corp 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 Glaukos Corp are associated (or correlated) with Dow Jones. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dow Jones Industrial has no effect on the direction of Glaukos Corp i.e., Glaukos Corp and Dow Jones go up and down completely randomly.
Pair Corralation between Glaukos Corp and Dow Jones
Given the investment horizon of 90 days Glaukos Corp is expected to generate 3.48 times more return on investment than Dow Jones. However, Glaukos Corp is 3.48 times more volatile than Dow Jones Industrial. It trades about 0.1 of its potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.07 per unit of risk. If you would invest 4,588 in Glaukos Corp on August 24, 2024 and sell it today you would earn a total of 9,495 from holding Glaukos Corp or generate 206.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Glaukos Corp vs. Dow Jones Industrial
Performance |
| Timeline |
Glaukos Corp and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
Glaukos Corp
Pair trading matchups for Glaukos Corp
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with Glaukos Corp and Dow Jones
The main advantage of trading using opposite Glaukos Corp and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Glaukos Corp position performs unexpectedly, Dow Jones 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 Dow Jones will offset losses from the drop in Dow Jones' long position.| Glaukos Corp vs. Orthopediatrics Corp | Glaukos Corp vs. CONMED | Glaukos Corp vs. LivaNova PLC | Glaukos Corp vs. Paragon 28 |
| Dow Jones vs. Sphere Entertainment Co | Dow Jones vs. Perseus Mining Limited | Dow Jones vs. Titan Machinery | Dow Jones vs. Simon Property Group |
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 Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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