Correlation Between Train Alliance and Dow Jones
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By analyzing existing cross correlation between Train Alliance Sweden and Dow Jones Industrial, you can compare the effects of market volatilities on Train Alliance 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 Train Alliance with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of Train Alliance and Dow Jones.
Diversification Opportunities for Train Alliance and Dow Jones
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Train and Dow is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Train Alliance Sweden 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 Train Alliance 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 Train Alliance Sweden 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 Train Alliance i.e., Train Alliance and Dow Jones go up and down completely randomly.
Pair Corralation between Train Alliance and Dow Jones
Assuming the 90 days trading horizon Train Alliance Sweden is expected to under-perform the Dow Jones. In addition to that, Train Alliance is 2.91 times more volatile than Dow Jones Industrial. It trades about -0.03 of its total potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.1 per unit of volatility. If you would invest 3,528,252 in Dow Jones Industrial on August 26, 2024 and sell it today you would earn a total of 901,399 from holding Dow Jones Industrial or generate 25.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.4% |
| Values | Daily Returns |
Train Alliance Sweden vs. Dow Jones Industrial
Performance |
| Timeline |
Train Alliance and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
Train Alliance Sweden
Pair trading matchups for Train Alliance
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with Train Alliance and Dow Jones
The main advantage of trading using opposite Train Alliance and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Train Alliance 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.| Train Alliance vs. Bergman Beving AB | Train Alliance vs. FM Mattsson Mora | Train Alliance vs. Systemair AB | Train Alliance vs. Rejlers AB |
| Dow Jones vs. Vistra Energy Corp | Dow Jones vs. Fluence Energy | Dow Jones vs. Old Republic International | Dow Jones vs. Empresa Distribuidora y |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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