Correlation Between Occidental and Dow Jones
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By analyzing existing cross correlation between Occidental Petroleum 0 and Dow Jones Industrial, you can compare the effects of market volatilities on Occidental 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 Occidental with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of Occidental and Dow Jones.
Diversification Opportunities for Occidental and Dow Jones
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Occidental and Dow is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Occidental Petroleum 0 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 Occidental 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 Occidental Petroleum 0 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 Occidental i.e., Occidental and Dow Jones go up and down completely randomly.
Pair Corralation between Occidental and Dow Jones
Assuming the 90 days trading horizon Occidental Petroleum 0 is expected to generate 119.15 times more return on investment than Dow Jones. However, Occidental is 119.15 times more volatile than Dow Jones Industrial. It trades about 0.08 of its potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.08 per unit of risk. If you would invest 5,097 in Occidental Petroleum 0 on September 3, 2024 and sell it today you would earn a total of 394.00 from holding Occidental Petroleum 0 or generate 7.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 27.68% |
| Values | Daily Returns |
Occidental Petroleum 0 vs. Dow Jones Industrial
Performance |
| Timeline |
Occidental and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
Occidental Petroleum 0
Pair trading matchups for Occidental
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with Occidental and Dow Jones
The main advantage of trading using opposite Occidental and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Occidental 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.| Occidental vs. Air Lease | Occidental vs. NETGEAR | Occidental vs. Global Ship Lease | Occidental vs. Valneva SE 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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