Correlation Between Wuxi Xuelang and Dow Jones
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By analyzing existing cross correlation between Wuxi Xuelang Environmental and Dow Jones Industrial, you can compare the effects of market volatilities on Wuxi Xuelang 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 Wuxi Xuelang with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wuxi Xuelang and Dow Jones.
Diversification Opportunities for Wuxi Xuelang and Dow Jones
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Wuxi and Dow is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Wuxi Xuelang Environmental 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 Wuxi Xuelang 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 Wuxi Xuelang Environmental 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 Wuxi Xuelang i.e., Wuxi Xuelang and Dow Jones go up and down completely randomly.
Pair Corralation between Wuxi Xuelang and Dow Jones
Assuming the 90 days trading horizon Wuxi Xuelang is expected to generate 2.57 times less return on investment than Dow Jones. In addition to that, Wuxi Xuelang is 5.43 times more volatile than Dow Jones Industrial. It trades about 0.01 of its total potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.1 per unit of volatility. If you would invest 4,211,440 in Dow Jones Industrial on October 25, 2024 and sell it today you would earn a total of 204,233 from holding Dow Jones Industrial or generate 4.85% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 95.24% |
Values | Daily Returns |
Wuxi Xuelang Environmental vs. Dow Jones Industrial
Performance |
Timeline |
Wuxi Xuelang and Dow Jones Volatility Contrast
Predicted Return Density |
Returns |
Wuxi Xuelang Environmental
Pair trading matchups for Wuxi Xuelang
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with Wuxi Xuelang and Dow Jones
The main advantage of trading using opposite Wuxi Xuelang and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wuxi Xuelang 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.Wuxi Xuelang vs. Kweichow Moutai Co | Wuxi Xuelang vs. Contemporary Amperex Technology | Wuxi Xuelang vs. Beijing Roborock Technology | Wuxi Xuelang vs. BYD Co Ltd |
Dow Jones vs. Xiabuxiabu Catering Management | Dow Jones vs. Neogen | Dow Jones vs. Orion Office Reit | Dow Jones vs. Bassett Furniture Industries |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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