Correlation Between Konya Cimento and Dow Jones
Can any of the company-specific risk be diversified away by investing in both Konya Cimento 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 Konya Cimento and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Konya Cimento Sanayi and Dow Jones Industrial, you can compare the effects of market volatilities on Konya Cimento 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 Konya Cimento with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of Konya Cimento and Dow Jones.
Diversification Opportunities for Konya Cimento and Dow Jones
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between Konya and Dow is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Konya Cimento Sanayi 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 Konya Cimento 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 Konya Cimento Sanayi 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 Konya Cimento i.e., Konya Cimento and Dow Jones go up and down completely randomly.
Pair Corralation between Konya Cimento and Dow Jones
Assuming the 90 days trading horizon Konya Cimento Sanayi is expected to generate 5.38 times more return on investment than Dow Jones. However, Konya Cimento is 5.38 times more volatile than Dow Jones Industrial. It trades about 0.06 of its potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.08 per unit of risk. If you would invest 305,950 in Konya Cimento Sanayi on August 25, 2024 and sell it today you would earn a total of 372,050 from holding Konya Cimento Sanayi or generate 121.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Konya Cimento Sanayi vs. Dow Jones Industrial
Performance |
| Timeline |
Konya Cimento and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
Konya Cimento Sanayi
Pair trading matchups for Konya Cimento
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with Konya Cimento and Dow Jones
The main advantage of trading using opposite Konya Cimento and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Konya Cimento 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.| Konya Cimento vs. Ege Endustri ve | Konya Cimento vs. Kartonsan Karton Sanayi | Konya Cimento vs. Nuh Cimento Sanayi | Konya Cimento vs. Afyon Cimento Sanayi |
| 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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