Correlation Between LED IBond and Dow Jones
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By analyzing existing cross correlation between LED iBond International and Dow Jones Industrial, you can compare the effects of market volatilities on LED IBond 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 LED IBond with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of LED IBond and Dow Jones.
Diversification Opportunities for LED IBond and Dow Jones
Significant diversification
The 3 months correlation between LED and Dow is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding LED iBond International 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 LED IBond 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 LED iBond International 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 LED IBond i.e., LED IBond and Dow Jones go up and down completely randomly.
Pair Corralation between LED IBond and Dow Jones
Assuming the 90 days trading horizon LED iBond International is expected to generate 33.38 times more return on investment than Dow Jones. However, LED IBond is 33.38 times more volatile than Dow Jones Industrial. It trades about 0.22 of its potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.21 per unit of risk. If you would invest 16.00 in LED iBond International on August 25, 2024 and sell it today you would earn a total of 16.00 from holding LED iBond International or generate 100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
LED iBond International vs. Dow Jones Industrial
Performance |
| Timeline |
LED IBond and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
LED iBond International
Pair trading matchups for LED IBond
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with LED IBond and Dow Jones
The main advantage of trading using opposite LED IBond and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LED IBond 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.| LED IBond vs. BankInvest Optima 30 | LED IBond vs. Gabriel Holding | LED IBond vs. Fundamental Invest Stock | LED IBond vs. Broedrene AO Johansen |
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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 CEOs Directory module to screen CEOs from public companies around the world.
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