Correlation Between Dow 2x and Janus Growth
Can any of the company-specific risk be diversified away by investing in both Dow 2x and Janus Growth 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 Dow 2x and Janus Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dow 2x Strategy and Janus Growth And, you can compare the effects of market volatilities on Dow 2x and Janus Growth 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 Dow 2x with a short position of Janus Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dow 2x and Janus Growth.
Diversification Opportunities for Dow 2x and Janus Growth
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Dow and Janus is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Dow 2x Strategy and Janus Growth And in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Janus Growth And and Dow 2x 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 Dow 2x Strategy are associated (or correlated) with Janus Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Janus Growth And has no effect on the direction of Dow 2x i.e., Dow 2x and Janus Growth go up and down completely randomly.
Pair Corralation between Dow 2x and Janus Growth
Assuming the 90 days horizon Dow 2x Strategy is expected to generate 1.3 times more return on investment than Janus Growth. However, Dow 2x is 1.3 times more volatile than Janus Growth And. It trades about 0.11 of its potential returns per unit of risk. Janus Growth And is currently generating about 0.03 per unit of risk. If you would invest 10,553 in Dow 2x Strategy on September 14, 2024 and sell it today you would earn a total of 5,072 from holding Dow 2x Strategy or generate 48.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dow 2x Strategy vs. Janus Growth And
Performance |
| Timeline |
| Dow 2x Strategy |
| Janus Growth And |
Dow 2x and Janus Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dow 2x and Janus Growth
The main advantage of trading using opposite Dow 2x and Janus Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dow 2x position performs unexpectedly, Janus Growth 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 Janus Growth will offset losses from the drop in Janus Growth's long position.| Dow 2x vs. Sp 500 2x | Dow 2x vs. Inverse Dow 2x | Dow 2x vs. Nasdaq 100 2x Strategy | Dow 2x vs. Russell 2000 2x |
| Janus Growth vs. Janus Enterprise Fund | Janus Growth vs. Siit Dynamic Asset | Janus Growth vs. Columbia Large Cap | Janus Growth vs. Siit Large Cap |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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