Correlation Between RTL Group and Dow Jones
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By analyzing existing cross correlation between RTL Group SA and Dow Jones Industrial, you can compare the effects of market volatilities on RTL Group 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 RTL Group with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of RTL Group and Dow Jones.
Diversification Opportunities for RTL Group and Dow Jones
Excellent diversification
The 3 months correlation between RTL and Dow is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding RTL Group SA 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 RTL Group 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 RTL Group SA 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 RTL Group i.e., RTL Group and Dow Jones go up and down completely randomly.
Pair Corralation between RTL Group and Dow Jones
Assuming the 90 days trading horizon RTL Group SA is expected to under-perform the Dow Jones. In addition to that, RTL Group is 2.78 times more volatile than Dow Jones Industrial. It trades about -0.22 of its total potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.16 per unit of volatility. If you would invest 4,233,015 in Dow Jones Industrial on August 30, 2024 and sell it today you would earn a total of 239,191 from holding Dow Jones Industrial or generate 5.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
RTL Group SA vs. Dow Jones Industrial
Performance |
| Timeline |
RTL Group and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
RTL Group SA
Pair trading matchups for RTL Group
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with RTL Group and Dow Jones
The main advantage of trading using opposite RTL Group and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if RTL Group 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.| RTL Group vs. WIZZ AIR HLDGUNSPADR4 | RTL Group vs. NORTHEAST UTILITIES | RTL Group vs. ALTAIR RES INC | RTL Group vs. PREMIER FOODS |
| Dow Jones vs. Kaltura | Dow Jones vs. Artisan Partners Asset | Dow Jones vs. US Global Investors | Dow Jones vs. Analog Devices |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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