Correlation Between FEDEX and Dow Jones
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By analyzing existing cross correlation between FEDEX P 42 and Dow Jones Industrial, you can compare the effects of market volatilities on FEDEX 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 FEDEX with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of FEDEX and Dow Jones.
Diversification Opportunities for FEDEX and Dow Jones
Very good diversification
The 3 months correlation between FEDEX and Dow is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding FEDEX P 42 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 FEDEX 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 FEDEX P 42 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 FEDEX i.e., FEDEX and Dow Jones go up and down completely randomly.
Pair Corralation between FEDEX and Dow Jones
Assuming the 90 days trading horizon FEDEX is expected to generate 123.7 times less return on investment than Dow Jones. In addition to that, FEDEX is 1.65 times more volatile than Dow Jones Industrial. It trades about 0.0 of its total potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.16 per unit of volatility. If you would invest 3,857,103 in Dow Jones Industrial on September 1, 2024 and sell it today you would earn a total of 633,962 from holding Dow Jones Industrial or generate 16.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 90.48% |
| Values | Daily Returns |
FEDEX P 42 vs. Dow Jones Industrial
Performance |
| Timeline |
FEDEX and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
FEDEX P 42
Pair trading matchups for FEDEX
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with FEDEX and Dow Jones
The main advantage of trading using opposite FEDEX and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FEDEX 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.The idea behind FEDEX P 42 and Dow Jones Industrial pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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