Correlation Between Rafina Innovations and Dow Jones
Can any of the company-specific risk be diversified away by investing in both Rafina Innovations and Dow Jones at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Rafina Innovations and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Rafina Innovations and Dow Jones Industrial, you can compare the effects of market volatilities on Rafina Innovations 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 Rafina Innovations with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rafina Innovations and Dow Jones.
Diversification Opportunities for Rafina Innovations and Dow Jones
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Rafina and Dow is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Rafina Innovations 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 Rafina Innovations 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 Rafina Innovations 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 Rafina Innovations i.e., Rafina Innovations and Dow Jones go up and down completely randomly.
Pair Corralation between Rafina Innovations and Dow Jones
Given the investment horizon of 90 days Rafina Innovations is expected to generate 104.74 times more return on investment than Dow Jones. However, Rafina Innovations is 104.74 times more volatile than Dow Jones Industrial. It trades about 0.06 of its potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.09 per unit of risk. If you would invest 0.05 in Rafina Innovations on October 23, 2024 and sell it today you would lose (0.04) from holding Rafina Innovations or give up 80.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.74% |
| Values | Daily Returns |
Rafina Innovations vs. Dow Jones Industrial
Performance |
| Timeline |
Rafina Innovations and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
Rafina Innovations
Pair trading matchups for Rafina Innovations
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with Rafina Innovations and Dow Jones
The main advantage of trading using opposite Rafina Innovations and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rafina Innovations 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.| Rafina Innovations vs. LENSAR Inc | Rafina Innovations vs. Sight Sciences | Rafina Innovations vs. STRATA Skin Sciences | Rafina Innovations vs. enVVeno Medical Corp |
| Dow Jones vs. Grupo Televisa SAB | Dow Jones vs. NiSource | Dow Jones vs. Kinetik Holdings | Dow Jones vs. Empresa Distribuidora y |
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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