Correlation Between JCK Hospitality and Dow Jones
Can any of the company-specific risk be diversified away by investing in both JCK Hospitality 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 JCK Hospitality and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JCK Hospitality Public and Dow Jones Industrial, you can compare the effects of market volatilities on JCK Hospitality 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 JCK Hospitality with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of JCK Hospitality and Dow Jones.
Diversification Opportunities for JCK Hospitality and Dow Jones
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between JCK and Dow is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding JCK Hospitality Public 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 JCK Hospitality 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 JCK Hospitality Public 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 JCK Hospitality i.e., JCK Hospitality and Dow Jones go up and down completely randomly.
Pair Corralation between JCK Hospitality and Dow Jones
Assuming the 90 days trading horizon JCK Hospitality Public is expected to generate 96.33 times more return on investment than Dow Jones. However, JCK Hospitality is 96.33 times more volatile than Dow Jones Industrial. It trades about 0.08 of its potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.12 per unit of risk. If you would invest 3.00 in JCK Hospitality Public on September 4, 2024 and sell it today you would lose (1.00) from holding JCK Hospitality Public or give up 33.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 97.15% |
| Values | Daily Returns |
JCK Hospitality Public vs. Dow Jones Industrial
Performance |
| Timeline |
JCK Hospitality and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
JCK Hospitality Public
Pair trading matchups for JCK Hospitality
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with JCK Hospitality and Dow Jones
The main advantage of trading using opposite JCK Hospitality and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JCK Hospitality 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.| JCK Hospitality vs. Sriracha Construction Public | JCK Hospitality vs. Global Green Chemicals | JCK Hospitality vs. Symphony Communication Public | JCK Hospitality vs. Rich Sport Public |
| Dow Jones vs. Gentex | Dow Jones vs. American Axle Manufacturing | Dow Jones vs. Pearson PLC ADR | Dow Jones vs. Marine Products |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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