Correlation Between World Kinect and Dow Jones
Can any of the company-specific risk be diversified away by investing in both World Kinect 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 World Kinect and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between World Kinect and Dow Jones Industrial, you can compare the effects of market volatilities on World Kinect 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 World Kinect with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of World Kinect and Dow Jones.
Diversification Opportunities for World Kinect and Dow Jones
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between World and Dow is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding World Kinect 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 World Kinect 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 World Kinect 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 World Kinect i.e., World Kinect and Dow Jones go up and down completely randomly.
Pair Corralation between World Kinect and Dow Jones
Considering the 90-day investment horizon World Kinect is expected to under-perform the Dow Jones. In addition to that, World Kinect is 4.05 times more volatile than Dow Jones Industrial. It trades about -0.1 of its total potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.15 per unit of volatility. If you would invest 4,251,495 in Dow Jones Industrial on August 24, 2024 and sell it today you would earn a total of 135,540 from holding Dow Jones Industrial or generate 3.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
World Kinect vs. Dow Jones Industrial
Performance |
| Timeline |
World Kinect and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
World Kinect
Pair trading matchups for World Kinect
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with World Kinect and Dow Jones
The main advantage of trading using opposite World Kinect and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if World Kinect 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.| World Kinect vs. NioCorp Developments Ltd | World Kinect vs. Peoples Educational Holdings | World Kinect vs. Aerofoam Metals | World Kinect vs. Yuexiu Transport Infrastructure |
| Dow Jones vs. Sphere Entertainment Co | Dow Jones vs. Perseus Mining Limited | Dow Jones vs. Titan Machinery | Dow Jones vs. Simon Property Group |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
Other Complementary Tools
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon |