Correlation Between Swiss Helvetia and Dow Jones
Can any of the company-specific risk be diversified away by investing in both Swiss Helvetia 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 Swiss Helvetia and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Swiss Helvetia Closed and Dow Jones Industrial, you can compare the effects of market volatilities on Swiss Helvetia 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 Swiss Helvetia with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of Swiss Helvetia and Dow Jones.
Diversification Opportunities for Swiss Helvetia and Dow Jones
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Swiss and Dow is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Swiss Helvetia Closed 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 Swiss Helvetia 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 Swiss Helvetia Closed 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 Swiss Helvetia i.e., Swiss Helvetia and Dow Jones go up and down completely randomly.
Pair Corralation between Swiss Helvetia and Dow Jones
Considering the 90-day investment horizon Swiss Helvetia Closed is expected to generate 2.03 times more return on investment than Dow Jones. However, Swiss Helvetia is 2.03 times more volatile than Dow Jones Industrial. It trades about 0.36 of its potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.17 per unit of risk. If you would invest 759.00 in Swiss Helvetia Closed on October 20, 2024 and sell it today you would earn a total of 86.00 from holding Swiss Helvetia Closed or generate 11.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Swiss Helvetia Closed vs. Dow Jones Industrial
Performance |
| Timeline |
Swiss Helvetia and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
Swiss Helvetia Closed
Pair trading matchups for Swiss Helvetia
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with Swiss Helvetia and Dow Jones
The main advantage of trading using opposite Swiss Helvetia and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Swiss Helvetia 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.| Swiss Helvetia vs. MFS High Yield | Swiss Helvetia vs. MFS High Income | Swiss Helvetia vs. MFS Multimarket Income | Swiss Helvetia vs. MFS Intermediate Income |
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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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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