Correlation Between ETF Opportunities and Dow Jones
Can any of the company-specific risk be diversified away by investing in both ETF Opportunities 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 ETF Opportunities and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ETF Opportunities Trust and Dow Jones Industrial, you can compare the effects of market volatilities on ETF Opportunities 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 ETF Opportunities with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of ETF Opportunities and Dow Jones.
Diversification Opportunities for ETF Opportunities and Dow Jones
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between ETF and Dow is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding ETF Opportunities Trust 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 ETF Opportunities 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 ETF Opportunities Trust 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 ETF Opportunities i.e., ETF Opportunities and Dow Jones go up and down completely randomly.
Pair Corralation between ETF Opportunities and Dow Jones
Given the investment horizon of 90 days ETF Opportunities Trust is expected to generate 1.16 times more return on investment than Dow Jones. However, ETF Opportunities is 1.16 times more volatile than Dow Jones Industrial. It trades about 0.12 of its potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.11 per unit of risk. If you would invest 2,508 in ETF Opportunities Trust on September 1, 2024 and sell it today you would earn a total of 540.00 from holding ETF Opportunities Trust or generate 21.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 99.47% |
| Values | Daily Returns |
ETF Opportunities Trust vs. Dow Jones Industrial
Performance |
| Timeline |
ETF Opportunities and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
ETF Opportunities Trust
Pair trading matchups for ETF Opportunities
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with ETF Opportunities and Dow Jones
The main advantage of trading using opposite ETF Opportunities and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ETF Opportunities 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.| ETF Opportunities vs. Vanguard Total Stock | ETF Opportunities vs. SPDR SP 500 | ETF Opportunities vs. iShares Core SP | ETF Opportunities vs. Vanguard Dividend Appreciation |
| 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
Other Complementary Tools
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance |