Pair Correlation Between DOW and Workday

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

Pair Volatility

Given the investment horizon of 30 days, DOW is expected to generate 1.33 times less return on investment than Workday. But when comparing it to its historical volatility, DOW is 6.41 times less risky than Workday. It trades about 0.65 of its potential returns per unit of risk. Workday Inc is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest  10,383  in Workday Inc on September 21, 2017 and sell it today you would earn a total of  473  from holding Workday Inc or generate 4.56% return on investment over 30 days.

Correlation Coefficient

Pair Corralation between DOW and Workday
0.82

Parameters

Time Period1 Month [change]
DirectionPositive 
StrengthStrong
Accuracy100.0%
ValuesDaily Returns

Diversification

Very poor diversification

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

Comparative Volatility

 Predicted Return Density 
      Returns