Correlation Between ETFS 1x and Dow Jones
Can any of the company-specific risk be diversified away by investing in both ETFS 1x 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 ETFS 1x and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ETFS 1x Daily and Dow Jones Industrial, you can compare the effects of market volatilities on ETFS 1x 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 ETFS 1x with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of ETFS 1x and Dow Jones.
Diversification Opportunities for ETFS 1x and Dow Jones
Pay attention - limited upside
The 3 months correlation between ETFS and Dow is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding ETFS 1x Daily 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 ETFS 1x 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 ETFS 1x Daily 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 ETFS 1x i.e., ETFS 1x and Dow Jones go up and down completely randomly.
Pair Corralation between ETFS 1x and Dow Jones
If you would invest 3,387,678 in Dow Jones Industrial on September 1, 2024 and sell it today you would earn a total of 1,103,387 from holding Dow Jones Industrial or generate 32.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
ETFS 1x Daily vs. Dow Jones Industrial
Performance |
| Timeline |
ETFS 1x and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
ETFS 1x Daily
Pair trading matchups for ETFS 1x
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with ETFS 1x and Dow Jones
The main advantage of trading using opposite ETFS 1x and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ETFS 1x 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.| ETFS 1x vs. MTI Wireless Edge | ETFS 1x vs. Iron Mountain | ETFS 1x vs. Compagnie Plastic Omnium | ETFS 1x vs. Trainline Plc |
| 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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