Correlation Between Huber Capital and Dow Jones
Can any of the company-specific risk be diversified away by investing in both Huber Capital 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 Huber Capital and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Huber Capital Mid and Dow Jones Industrial, you can compare the effects of market volatilities on Huber Capital 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 Huber Capital with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of Huber Capital and Dow Jones.
Diversification Opportunities for Huber Capital and Dow Jones
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Huber and Dow is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Huber Capital Mid 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 Huber Capital 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 Huber Capital Mid 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 Huber Capital i.e., Huber Capital and Dow Jones go up and down completely randomly.
Pair Corralation between Huber Capital and Dow Jones
Assuming the 90 days horizon Huber Capital Mid is expected to generate 1.67 times more return on investment than Dow Jones. However, Huber Capital is 1.67 times more volatile than Dow Jones Industrial. It trades about 0.13 of its potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.2 per unit of risk. If you would invest 1,593 in Huber Capital Mid on September 3, 2024 and sell it today you would earn a total of 162.00 from holding Huber Capital Mid or generate 10.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Huber Capital Mid vs. Dow Jones Industrial
Performance |
| Timeline |
Huber Capital and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
Huber Capital Mid
Pair trading matchups for Huber Capital
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with Huber Capital and Dow Jones
The main advantage of trading using opposite Huber Capital and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Huber Capital 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.| Huber Capital vs. Janus Global Technology | Huber Capital vs. Pgim Jennison Technology | Huber Capital vs. Firsthand Technology Opportunities | Huber Capital vs. Hennessy Technology Fund |
| Dow Jones vs. Eastern Co | Dow Jones vs. Uber Technologies | Dow Jones vs. AKITA Drilling | Dow Jones vs. Chemours 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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