Correlation Between Golden Grail and Dow Jones
Can any of the company-specific risk be diversified away by investing in both Golden Grail 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 Golden Grail and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Golden Grail Technology and Dow Jones Industrial, you can compare the effects of market volatilities on Golden Grail 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 Golden Grail with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of Golden Grail and Dow Jones.
Diversification Opportunities for Golden Grail and Dow Jones
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Golden and Dow is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Golden Grail Technology 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 Golden Grail 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 Golden Grail Technology 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 Golden Grail i.e., Golden Grail and Dow Jones go up and down completely randomly.
Pair Corralation between Golden Grail and Dow Jones
Given the investment horizon of 90 days Golden Grail Technology is expected to generate 16.68 times more return on investment than Dow Jones. However, Golden Grail is 16.68 times more volatile than Dow Jones Industrial. It trades about 0.02 of its potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.08 per unit of risk. If you would invest 44.00 in Golden Grail Technology on August 29, 2024 and sell it today you would lose (39.92) from holding Golden Grail Technology or give up 90.73% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Golden Grail Technology vs. Dow Jones Industrial
Performance |
| Timeline |
Golden Grail and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
Golden Grail Technology
Pair trading matchups for Golden Grail
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with Golden Grail and Dow Jones
The main advantage of trading using opposite Golden Grail and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Golden Grail 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.| Golden Grail vs. Tencent Holdings | Golden Grail vs. Autohome | Golden Grail vs. Arena Group Holdings | Golden Grail vs. Asset Entities Class |
| Dow Jones vs. Kaltura | Dow Jones vs. Artisan Partners Asset | Dow Jones vs. US Global Investors | Dow Jones vs. Analog Devices |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
Other Complementary Tools
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Money Managers Screen money managers from public funds and ETFs managed around the world |