Correlation Between ASTRAZENECA and Dow Jones
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By analyzing existing cross correlation between ASTRAZENECA PLC 4 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
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between ASTRAZENECA and Dow is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding ASTRAZENECA PLC 4 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 4 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 is expected to generate 20.53 times less return on investment than Dow Jones. But when comparing it to its historical volatility, ASTRAZENECA PLC 4 is 1.62 times less risky than Dow Jones. It trades about 0.01 of its potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 3,383,361 in Dow Jones Industrial on August 31, 2024 and sell it today you would earn a total of 1,107,704 from holding Dow Jones Industrial or generate 32.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 98.13% |
| Values | Daily Returns |
ASTRAZENECA PLC 4 vs. Dow Jones Industrial
Performance |
| Timeline |
ASTRAZENECA and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
ASTRAZENECA PLC 4
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 |
| Dow Jones vs. Aerofoam Metals | Dow Jones vs. ACG Metals Limited | Dow Jones vs. China Clean Energy | Dow Jones vs. Fast Retailing Co |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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