Correlation Between Sirius and Dow Jones
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By analyzing existing cross correlation between Sirius XM Holdings and Dow Jones Industrial, you can compare the effects of market volatilities on Sirius 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 Sirius with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sirius and Dow Jones.
Diversification Opportunities for Sirius and Dow Jones
Average diversification
The 3 months correlation between Sirius and Dow is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Sirius XM Holdings 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 Sirius 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 Sirius XM Holdings 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 Sirius i.e., Sirius and Dow Jones go up and down completely randomly.
Pair Corralation between Sirius and Dow Jones
Assuming the 90 days trading horizon Sirius XM Holdings is expected to under-perform the Dow Jones. In addition to that, Sirius is 1.02 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 -0.05 per unit of volatility. If you would invest 4,306,522 in Dow Jones Industrial on October 13, 2024 and sell it today you would lose (112,677) from holding Dow Jones Industrial or give up 2.62% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 98.39% |
Values | Daily Returns |
Sirius XM Holdings vs. Dow Jones Industrial
Performance |
Timeline |
Sirius and Dow Jones Volatility Contrast
Predicted Return Density |
Returns |
Sirius XM Holdings
Pair trading matchups for Sirius
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with Sirius and Dow Jones
The main advantage of trading using opposite Sirius and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sirius 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.Sirius vs. Keurig Dr Pepper | Sirius vs. Primo Brands | Sirius vs. CECO Environmental Corp | Sirius vs. Diageo PLC ADR |
Dow Jones vs. Lululemon Athletica | Dow Jones vs. Vistra Energy Corp | Dow Jones vs. The Gap, | Dow Jones vs. Pool Corporation |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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