Correlation Between Menteng Heritage and Dow Jones
Can any of the company-specific risk be diversified away by investing in both Menteng Heritage 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 Menteng Heritage and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Menteng Heritage Realty and Dow Jones Industrial, you can compare the effects of market volatilities on Menteng Heritage 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 Menteng Heritage with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of Menteng Heritage and Dow Jones.
Diversification Opportunities for Menteng Heritage and Dow Jones
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Menteng and Dow is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Menteng Heritage Realty 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 Menteng Heritage 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 Menteng Heritage Realty 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 Menteng Heritage i.e., Menteng Heritage and Dow Jones go up and down completely randomly.
Pair Corralation between Menteng Heritage and Dow Jones
Assuming the 90 days trading horizon Menteng Heritage Realty is expected to generate 4.97 times more return on investment than Dow Jones. However, Menteng Heritage is 4.97 times more volatile than Dow Jones Industrial. It trades about 0.39 of its potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.29 per unit of risk. If you would invest 3,200 in Menteng Heritage Realty on August 31, 2024 and sell it today you would earn a total of 1,400 from holding Menteng Heritage Realty or generate 43.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Menteng Heritage Realty vs. Dow Jones Industrial
Performance |
| Timeline |
Menteng Heritage and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
Menteng Heritage Realty
Pair trading matchups for Menteng Heritage
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with Menteng Heritage and Dow Jones
The main advantage of trading using opposite Menteng Heritage and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Menteng Heritage 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.| Menteng Heritage vs. Jasa Armada Indonesia | Menteng Heritage vs. Cahayaputra Asa Keramik | Menteng Heritage vs. Campina Ice Cream | Menteng Heritage vs. Integra Indocabinet Tbk |
| 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
Other Complementary Tools
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account |