Correlation Between IZafe Group and Dow Jones
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By analyzing existing cross correlation between iZafe Group AB and Dow Jones Industrial, you can compare the effects of market volatilities on IZafe Group 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 IZafe Group with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of IZafe Group and Dow Jones.
Diversification Opportunities for IZafe Group and Dow Jones
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between IZafe and Dow is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding iZafe Group AB 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 IZafe Group 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 iZafe Group AB 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 IZafe Group i.e., IZafe Group and Dow Jones go up and down completely randomly.
Pair Corralation between IZafe Group and Dow Jones
Assuming the 90 days trading horizon iZafe Group AB is expected to under-perform the Dow Jones. In addition to that, IZafe Group is 6.2 times more volatile than Dow Jones Industrial. It trades about -0.04 of its total potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.21 per unit of volatility. If you would invest 4,237,436 in Dow Jones Industrial on August 25, 2024 and sell it today you would earn a total of 192,215 from holding Dow Jones Industrial or generate 4.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
iZafe Group AB vs. Dow Jones Industrial
Performance |
| Timeline |
IZafe Group and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
iZafe Group AB
Pair trading matchups for IZafe Group
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with IZafe Group and Dow Jones
The main advantage of trading using opposite IZafe Group and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IZafe Group 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.| IZafe Group vs. Sprint Bioscience AB | IZafe Group vs. Acarix AS | IZafe Group vs. Annexin Pharmaceuticals AB |
| Dow Jones vs. Vistra Energy Corp | Dow Jones vs. Fluence Energy | Dow Jones vs. Old Republic International | Dow Jones vs. Empresa Distribuidora y |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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