Correlation Between Intrepid Endurance and Dow Jones
Can any of the company-specific risk be diversified away by investing in both Intrepid Endurance 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 Intrepid Endurance and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Intrepid Endurance Fund and Dow Jones Industrial, you can compare the effects of market volatilities on Intrepid Endurance 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 Intrepid Endurance with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intrepid Endurance and Dow Jones.
Diversification Opportunities for Intrepid Endurance and Dow Jones
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Intrepid and Dow is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Intrepid Endurance Fund 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 Intrepid Endurance 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 Intrepid Endurance Fund 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 Intrepid Endurance i.e., Intrepid Endurance and Dow Jones go up and down completely randomly.
Pair Corralation between Intrepid Endurance and Dow Jones
Assuming the 90 days horizon Intrepid Endurance is expected to generate 3.13 times less return on investment than Dow Jones. But when comparing it to its historical volatility, Intrepid Endurance Fund is 1.02 times less risky than Dow Jones. It trades about 0.08 of its potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest 4,211,440 in Dow Jones Industrial on August 26, 2024 and sell it today you would earn a total of 218,211 from holding Dow Jones Industrial or generate 5.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Intrepid Endurance Fund vs. Dow Jones Industrial
Performance |
| Timeline |
Intrepid Endurance and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
Intrepid Endurance Fund
Pair trading matchups for Intrepid Endurance
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with Intrepid Endurance and Dow Jones
The main advantage of trading using opposite Intrepid Endurance and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intrepid Endurance 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.| Intrepid Endurance vs. Amg Yacktman Focused | Intrepid Endurance vs. Intrepid Capital Fund | Intrepid Endurance vs. Heartland Value Plus | Intrepid Endurance vs. Appleseed Fund Appleseed |
| Dow Jones vs. MI Homes | Dow Jones vs. Franklin Street Properties | Dow Jones vs. Summit Hotel Properties | Dow Jones vs. Portillos |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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