Pair Correlation Between DOW and CA

This module allows you to analyze existing cross correlation between DOW and CA Inc. You can compare the effects of market volatilities on DOW and CA 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 CA. See also your portfolio center. Please also check ongoing floating volatility patterns of DOW and CA.
 Time Horizon     30 Days    Login   to change
Symbolsvs
 DOW  vs   CA Inc
 Performance (%) 
      Timeline 

Pair Volatility

Given the investment horizon of 30 days, DOW is expected to under-perform the CA. In addition to that, DOW is 1.02 times more volatile than CA Inc. It trades about -0.08 of its total potential returns per unit of risk. CA Inc is currently generating about 0.11 per unit of volatility. If you would invest  3,407  in CA Inc on January 19, 2018 and sell it today you would earn a total of  127.00  from holding CA Inc or generate 3.73% return on investment over 30 days.

Correlation Coefficient

Pair Corralation between DOW and CA
0.78

Parameters

Time Period1 Month [change]
DirectionPositive 
StrengthSignificant
Accuracy95.45%
ValuesDaily Returns

Diversification

Poor diversification

Overlapping area represents the amount of risk that can be diversified away by holding DOW and CA Inc in the same portfolio assuming nothing else is changed. The correlation between historical prices or returns on CA Inc 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 CA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CA Inc has no effect on the direction of DOW i.e. DOW and CA go up and down completely randomly.
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Comparative Volatility

 Predicted Return Density 
      Returns