Correlation Between FMEGR and Dow Jones
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By analyzing existing cross correlation between FMEGR 3 01 DEC 31 and Dow Jones Industrial, you can compare the effects of market volatilities on FMEGR 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 FMEGR with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of FMEGR and Dow Jones.
Diversification Opportunities for FMEGR and Dow Jones
Significant diversification
The 3 months correlation between FMEGR and Dow is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding FMEGR 3 01 DEC 31 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 FMEGR 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 FMEGR 3 01 DEC 31 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 FMEGR i.e., FMEGR and Dow Jones go up and down completely randomly.
Pair Corralation between FMEGR and Dow Jones
Assuming the 90 days trading horizon FMEGR is expected to generate 1.09 times less return on investment than Dow Jones. In addition to that, FMEGR is 2.67 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 0.08 per unit of volatility. If you would invest 3,410,864 in Dow Jones Industrial on September 3, 2024 and sell it today you would earn a total of 1,080,201 from holding Dow Jones Industrial or generate 31.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 46.67% |
| Values | Daily Returns |
FMEGR 3 01 DEC 31 vs. Dow Jones Industrial
Performance |
| Timeline |
FMEGR and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
FMEGR 3 01 DEC 31
Pair trading matchups for FMEGR
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with FMEGR and Dow Jones
The main advantage of trading using opposite FMEGR and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FMEGR 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.| FMEGR vs. CapitaLand Investment Limited | FMEGR vs. Boyd Gaming | FMEGR vs. Biglari Holdings | FMEGR vs. Aegon NV ADR |
| Dow Jones vs. Eastern Co | Dow Jones vs. Uber Technologies | Dow Jones vs. AKITA Drilling | Dow Jones vs. Chemours 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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