Correlation Between Dow Jones and MARRIOTT
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By analyzing existing cross correlation between Dow Jones Industrial and MARRIOTT INTL INC, you can compare the effects of market volatilities on Dow Jones and MARRIOTT 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 Dow Jones with a short position of MARRIOTT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dow Jones and MARRIOTT.
Diversification Opportunities for Dow Jones and MARRIOTT
Very good diversification
The 3 months correlation between Dow and MARRIOTT is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Dow Jones Industrial and MARRIOTT INTL INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MARRIOTT INTL INC and Dow Jones 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 Dow Jones Industrial are associated (or correlated) with MARRIOTT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MARRIOTT INTL INC has no effect on the direction of Dow Jones i.e., Dow Jones and MARRIOTT go up and down completely randomly.
Pair Corralation between Dow Jones and MARRIOTT
Assuming the 90 days trading horizon Dow Jones Industrial is expected to generate 0.24 times more return on investment than MARRIOTT. However, Dow Jones Industrial is 4.16 times less risky than MARRIOTT. It trades about 0.03 of its potential returns per unit of risk. MARRIOTT INTL INC is currently generating about -0.09 per unit of risk. If you would invest 4,220,822 in Dow Jones Industrial on September 24, 2024 and sell it today you would earn a total of 63,204 from holding Dow Jones Industrial or generate 1.5% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 57.81% |
Values | Daily Returns |
Dow Jones Industrial vs. MARRIOTT INTL INC
Performance |
Timeline |
Dow Jones and MARRIOTT Volatility Contrast
Predicted Return Density |
Returns |
Dow Jones Industrial
Pair trading matchups for Dow Jones
MARRIOTT INTL INC
Pair trading matchups for MARRIOTT
Pair Trading with Dow Jones and MARRIOTT
The main advantage of trading using opposite Dow Jones and MARRIOTT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dow Jones position performs unexpectedly, MARRIOTT 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 MARRIOTT will offset losses from the drop in MARRIOTT's long position.Dow Jones vs. Teleflex Incorporated | Dow Jones vs. Sonida Senior Living | Dow Jones vs. Avadel Pharmaceuticals PLC | Dow Jones vs. Cardinal Health |
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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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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