Correlation Between IMedia Brands and Dow Jones
Can any of the company-specific risk be diversified away by investing in both IMedia Brands 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 IMedia Brands and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between IMedia Brands 85 and Dow Jones Industrial, you can compare the effects of market volatilities on IMedia Brands 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 IMedia Brands with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of IMedia Brands and Dow Jones.
Diversification Opportunities for IMedia Brands and Dow Jones
-0.76 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between IMedia and Dow is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding IMedia Brands 85 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 IMedia Brands 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 IMedia Brands 85 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 IMedia Brands i.e., IMedia Brands and Dow Jones go up and down completely randomly.
Pair Corralation between IMedia Brands and Dow Jones
Assuming the 90 days horizon IMedia Brands 85 is expected to under-perform the Dow Jones. In addition to that, IMedia Brands is 14.5 times more volatile than Dow Jones Industrial. It trades about -0.05 of its total potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.09 per unit of volatility. If you would invest 3,320,222 in Dow Jones Industrial on September 5, 2024 and sell it today you would earn a total of 1,150,331 from holding Dow Jones Industrial or generate 34.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 29.49% |
| Values | Daily Returns |
IMedia Brands 85 vs. Dow Jones Industrial
Performance |
| Timeline |
IMedia Brands and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
IMedia Brands 85
Pair trading matchups for IMedia Brands
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with IMedia Brands and Dow Jones
The main advantage of trading using opposite IMedia Brands and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IMedia Brands 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.| IMedia Brands vs. Greenidge Generation Holdings | IMedia Brands vs. Synchronoss Technologies 8375 | IMedia Brands vs. Fossil Group 7 | IMedia Brands vs. Harrow Health 8625 |
| Dow Jones vs. Shake Shack | Dow Jones vs. Artisan Partners Asset | Dow Jones vs. Dave Busters Entertainment | Dow Jones vs. Meli Hotels International |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
Other Complementary Tools
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like |