Correlation Between Wallenius Wilhelmsen and Dow Jones
Can any of the company-specific risk be diversified away by investing in both Wallenius Wilhelmsen 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 Wallenius Wilhelmsen and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wallenius Wilhelmsen ASA and Dow Jones Industrial, you can compare the effects of market volatilities on Wallenius Wilhelmsen 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 Wallenius Wilhelmsen with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wallenius Wilhelmsen and Dow Jones.
Diversification Opportunities for Wallenius Wilhelmsen and Dow Jones
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Wallenius and Dow is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Wallenius Wilhelmsen ASA 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 Wallenius Wilhelmsen 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 Wallenius Wilhelmsen ASA 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 Wallenius Wilhelmsen i.e., Wallenius Wilhelmsen and Dow Jones go up and down completely randomly.
Pair Corralation between Wallenius Wilhelmsen and Dow Jones
Assuming the 90 days horizon Wallenius Wilhelmsen ASA is expected to under-perform the Dow Jones. In addition to that, Wallenius Wilhelmsen is 4.14 times more volatile than Dow Jones Industrial. It trades about -0.09 of its total potential returns per unit of risk. Dow Jones Industrial is currently generating about -0.01 per unit of volatility. If you would invest 4,395,819 in Dow Jones Industrial on September 14, 2024 and sell it today you would lose (4,407) from holding Dow Jones Industrial or give up 0.1% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Wallenius Wilhelmsen ASA vs. Dow Jones Industrial
Performance |
| Timeline |
Wallenius Wilhelmsen and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
Wallenius Wilhelmsen ASA
Pair trading matchups for Wallenius Wilhelmsen
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with Wallenius Wilhelmsen and Dow Jones
The main advantage of trading using opposite Wallenius Wilhelmsen and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wallenius Wilhelmsen 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.| Wallenius Wilhelmsen vs. Gol Intelligent Airlines | Wallenius Wilhelmsen vs. Meli Hotels International | Wallenius Wilhelmsen vs. DALATA HOTEL | Wallenius Wilhelmsen vs. PPHE HOTEL GROUP |
| Dow Jones vs. Hurco Companies | Dow Jones vs. Tyson Foods | Dow Jones vs. MYR Group | Dow Jones vs. Cannae Holdings |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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