Correlation Between Pacific Funds and Dow Jones
Can any of the company-specific risk be diversified away by investing in both Pacific Funds 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 Pacific Funds and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pacific Funds Small Cap and Dow Jones Industrial, you can compare the effects of market volatilities on Pacific Funds 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 Pacific Funds with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pacific Funds and Dow Jones.
Diversification Opportunities for Pacific Funds and Dow Jones
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Pacific and Dow is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Pacific Funds Small Cap 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 Pacific Funds 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 Pacific Funds Small Cap 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 Pacific Funds i.e., Pacific Funds and Dow Jones go up and down completely randomly.
Pair Corralation between Pacific Funds and Dow Jones
If you would invest 4,176,346 in Dow Jones Industrial on September 1, 2024 and sell it today you would earn a total of 314,719 from holding Dow Jones Industrial or generate 7.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 4.76% |
| Values | Daily Returns |
Pacific Funds Small Cap vs. Dow Jones Industrial
Performance |
| Timeline |
Pacific Funds and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
Pacific Funds Small Cap
Pair trading matchups for Pacific Funds
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with Pacific Funds and Dow Jones
The main advantage of trading using opposite Pacific Funds and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pacific Funds 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.| Pacific Funds vs. Gamco Global Gold | Pacific Funds vs. Precious Metals And | Pacific Funds vs. Short Precious Metals | Pacific Funds vs. Goldman Sachs Clean |
| Dow Jones vs. Catalyst Pharmaceuticals | Dow Jones vs. Sphere Entertainment Co | Dow Jones vs. National CineMedia | Dow Jones vs. Mink Therapeutics |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
Other Complementary Tools
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum |