Correlation Between Greenlane Holdings and Dow Jones
Can any of the company-specific risk be diversified away by investing in both Greenlane Holdings 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 Greenlane Holdings and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Greenlane Holdings and Dow Jones Industrial, you can compare the effects of market volatilities on Greenlane Holdings 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 Greenlane Holdings with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of Greenlane Holdings and Dow Jones.
Diversification Opportunities for Greenlane Holdings and Dow Jones
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Greenlane and Dow is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Greenlane Holdings 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 Greenlane Holdings 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 Greenlane Holdings 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 Greenlane Holdings i.e., Greenlane Holdings and Dow Jones go up and down completely randomly.
Pair Corralation between Greenlane Holdings and Dow Jones
Given the investment horizon of 90 days Greenlane Holdings is expected to under-perform the Dow Jones. In addition to that, Greenlane Holdings is 4.17 times more volatile than Dow Jones Industrial. It trades about -0.55 of its total potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.29 per unit of volatility. 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 | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Greenlane Holdings vs. Dow Jones Industrial
Performance |
| Timeline |
Greenlane Holdings and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
Greenlane Holdings
Pair trading matchups for Greenlane Holdings
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with Greenlane Holdings and Dow Jones
The main advantage of trading using opposite Greenlane Holdings and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Greenlane Holdings 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.| Greenlane Holdings vs. 1606 Corp | Greenlane Holdings vs. PT Hanjaya Mandala | Greenlane Holdings vs. Green Globe International | Greenlane Holdings vs. Kaival Brands Innovations |
| Dow Jones vs. Aerofoam Metals | Dow Jones vs. ACG Metals Limited | Dow Jones vs. China Clean Energy | Dow Jones vs. Fast Retailing Co |
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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