Correlation Analysis Between DOW and MerVal

This module allows you to analyze existing cross correlation between DOW and MerVal. You can compare the effects of market volatilities on DOW and MerVal 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 with a short position of MerVal. See also your portfolio center. Please also check ongoing floating volatility patterns of DOW and MerVal.
Horizon     30 Days    Login   to change
Symbolsvs
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Comparative Performance

 Predicted Return Density 
      Returns 

DOW  vs.  MerVal

 Performance (%) 
      Timeline 

Pair Volatility

Given the investment horizon of 30 days, DOW is expected to under-perform the MerVal. But the index apears to be less risky and, when comparing its historical volatility, DOW is 1.58 times less risky than MerVal. The index trades about -0.13 of its potential returns per unit of risk. The MerVal is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  2,869,061  in MerVal on November 18, 2018 and sell it today you would earn a total of  108,665  from holding MerVal or generate 3.79% return on investment over 30 days.

Pair Corralation between DOW and MerVal

0.06
Time Period2 Months [change]
DirectionPositive 
StrengthInsignificant
Accuracy97.56%
ValuesDaily Returns

Diversification Opportunities for DOW and MerVal

DOW diversification synergy

Significant diversification

Overlapping area represents the amount of risk that can be diversified away by holding DOW and MerVal in the same portfolio assuming nothing else is changed. The correlation between historical prices or returns on MerVal and DOW 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 are associated (or correlated) with MerVal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MerVal has no effect on the direction of DOW i.e. DOW and MerVal go up and down completely randomly.
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See also your portfolio center. Please also try Bollinger Bands module to use bollinger bands indicator to analyze target price for a given investing horizon.


 
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