Correlation Between Maiden Holdings and Dow Jones
Can any of the company-specific risk be diversified away by investing in both Maiden Holdings 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 Maiden Holdings and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Maiden Holdings North and Dow Jones Industrial, you can compare the effects of market volatilities on Maiden Holdings 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 Maiden Holdings with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of Maiden Holdings and Dow Jones.
Diversification Opportunities for Maiden Holdings and Dow Jones
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Maiden and Dow is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Maiden Holdings North 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 Maiden Holdings 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 Maiden Holdings North 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 Maiden Holdings i.e., Maiden Holdings and Dow Jones go up and down completely randomly.
Pair Corralation between Maiden Holdings and Dow Jones
Given the investment horizon of 90 days Maiden Holdings North is expected to under-perform the Dow Jones. In addition to that, Maiden Holdings is 2.0 times more volatile than Dow Jones Industrial. It trades about -0.06 of its total potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.19 per unit of volatility. If you would invest 4,251,495 in Dow Jones Industrial on August 24, 2024 and sell it today you would earn a total of 178,156 from holding Dow Jones Industrial or generate 4.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Maiden Holdings North vs. Dow Jones Industrial
Performance |
| Timeline |
Maiden Holdings and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
Maiden Holdings North
Pair trading matchups for Maiden Holdings
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with Maiden Holdings and Dow Jones
The main advantage of trading using opposite Maiden Holdings and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Maiden Holdings 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.| Maiden Holdings vs. Maiden Holdings | Maiden Holdings vs. Affiliated Managers Group | Maiden Holdings vs. Entergy New Orleans | Maiden Holdings vs. American Financial Group |
| Dow Jones vs. Sphere Entertainment Co | Dow Jones vs. Perseus Mining Limited | Dow Jones vs. Titan Machinery | Dow Jones vs. Simon Property Group |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
Other Complementary Tools
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk |