Correlation Between Tema Oncology and Dow Jones
Can any of the company-specific risk be diversified away by investing in both Tema Oncology and Dow Jones at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Tema Oncology and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tema Oncology ETF and Dow Jones Industrial, you can compare the effects of market volatilities on Tema Oncology 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 Tema Oncology with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tema Oncology and Dow Jones.
Diversification Opportunities for Tema Oncology and Dow Jones
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Tema and Dow is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Tema Oncology ETF 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 Tema Oncology 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 Tema Oncology ETF 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 Tema Oncology i.e., Tema Oncology and Dow Jones go up and down completely randomly.
Pair Corralation between Tema Oncology and Dow Jones
Given the investment horizon of 90 days Tema Oncology ETF is expected to generate 1.96 times more return on investment than Dow Jones. However, Tema Oncology is 1.96 times more volatile than Dow Jones Industrial. It trades about 0.29 of its potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.12 per unit of risk. If you would invest 2,744 in Tema Oncology ETF on September 8, 2025 and sell it today you would earn a total of 765.00 from holding Tema Oncology ETF or generate 27.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tema Oncology ETF vs. Dow Jones Industrial
Performance |
| Timeline |
Tema Oncology and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
Tema Oncology ETF
Pair trading matchups for Tema Oncology
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with Tema Oncology and Dow Jones
The main advantage of trading using opposite Tema Oncology and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tema Oncology 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.| Tema Oncology vs. Strategy Shares | Tema Oncology vs. Freedom Day Dividend | Tema Oncology vs. Franklin Templeton ETF | Tema Oncology vs. iShares MSCI China |
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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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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