Correlation Between ASTRAZENECA and Dow Jones
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By analyzing existing cross correlation between ASTRAZENECA PLC 645 and Dow Jones Industrial, you can compare the effects of market volatilities on ASTRAZENECA 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 ASTRAZENECA with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of ASTRAZENECA and Dow Jones.
Diversification Opportunities for ASTRAZENECA and Dow Jones
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ASTRAZENECA and Dow is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding ASTRAZENECA PLC 645 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 ASTRAZENECA 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 ASTRAZENECA PLC 645 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 ASTRAZENECA i.e., ASTRAZENECA and Dow Jones go up and down completely randomly.
Pair Corralation between ASTRAZENECA and Dow Jones
Assuming the 90 days trading horizon ASTRAZENECA PLC 645 is expected to generate 78.75 times more return on investment than Dow Jones. However, ASTRAZENECA is 78.75 times more volatile than Dow Jones Industrial. It trades about 0.05 of its potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.12 per unit of risk. If you would invest 11,438 in ASTRAZENECA PLC 645 on August 31, 2024 and sell it today you would lose (118.00) from holding ASTRAZENECA PLC 645 or give up 1.03% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.99% |
| Values | Daily Returns |
ASTRAZENECA PLC 645 vs. Dow Jones Industrial
Performance |
| Timeline |
ASTRAZENECA and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
ASTRAZENECA PLC 645
Pair trading matchups for ASTRAZENECA
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with ASTRAZENECA and Dow Jones
The main advantage of trading using opposite ASTRAZENECA and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ASTRAZENECA 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.| ASTRAZENECA vs. AEP TEX INC | ASTRAZENECA vs. US BANK NATIONAL | ASTRAZENECA vs. Bank of America | ASTRAZENECA vs. GE Aerospace |
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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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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