Correlation Between HAVN Life and Dow Jones
Can any of the company-specific risk be diversified away by investing in both HAVN Life 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 HAVN Life and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HAVN Life Sciences and Dow Jones Industrial, you can compare the effects of market volatilities on HAVN Life 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 HAVN Life with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of HAVN Life and Dow Jones.
Diversification Opportunities for HAVN Life and Dow Jones
Poor diversification
The 3 months correlation between HAVN and Dow is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding HAVN Life Sciences 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 HAVN Life 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 HAVN Life Sciences 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 HAVN Life i.e., HAVN Life and Dow Jones go up and down completely randomly.
Pair Corralation between HAVN Life and Dow Jones
Assuming the 90 days horizon HAVN Life Sciences is expected to generate 90.26 times more return on investment than Dow Jones. However, HAVN Life is 90.26 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 0.09 per unit of risk. If you would invest 5.50 in HAVN Life Sciences on August 31, 2024 and sell it today you would lose (4.98) from holding HAVN Life Sciences or give up 90.55% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.79% |
| Values | Daily Returns |
HAVN Life Sciences vs. Dow Jones Industrial
Performance |
| Timeline |
HAVN Life and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
HAVN Life Sciences
Pair trading matchups for HAVN Life
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with HAVN Life and Dow Jones
The main advantage of trading using opposite HAVN Life and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HAVN Life 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.| HAVN Life vs. Rigel Pharmaceuticals | HAVN Life vs. Geron | HAVN Life vs. Verastem | HAVN Life vs. Immutep Ltd ADR |
| 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets |