Correlation Between Dow Jones and The9
Can any of the company-specific risk be diversified away by investing in both Dow Jones and The9 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 Dow Jones and The9 into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dow Jones Industrial and The9 Ltd ADR, you can compare the effects of market volatilities on Dow Jones and The9 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 The9. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dow Jones and The9.
Diversification Opportunities for Dow Jones and The9
Good diversification
The 3 months correlation between Dow and The9 is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Dow Jones Industrial and The9 Ltd ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on The9 Ltd ADR 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 The9. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of The9 Ltd ADR has no effect on the direction of Dow Jones i.e., Dow Jones and The9 go up and down completely randomly.
Pair Corralation between Dow Jones and The9
Assuming the 90 days trading horizon Dow Jones Industrial is expected to generate 0.13 times more return on investment than The9. However, Dow Jones Industrial is 7.63 times less risky than The9. It trades about 0.12 of its potential returns per unit of risk. The9 Ltd ADR is currently generating about -0.04 per unit of risk. If you would invest 4,491,182 in Dow Jones Industrial on August 17, 2025 and sell it today you would earn a total of 223,566 from holding Dow Jones Industrial or generate 4.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dow Jones Industrial vs. The9 Ltd ADR
Performance |
| Timeline |
Dow Jones and The9 Volatility Contrast
Predicted Return Density |
| Returns |
Dow Jones Industrial
Pair trading matchups for Dow Jones
The9 Ltd ADR
Pair trading matchups for The9
Pair Trading with Dow Jones and The9
The main advantage of trading using opposite Dow Jones and The9 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dow Jones position performs unexpectedly, The9 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 The9 will offset losses from the drop in The9's long position.| Dow Jones vs. Thai Beverage PCL | Dow Jones vs. ISE Chemicals | Dow Jones vs. Park Electrochemical | Dow Jones vs. PTT Global Chemical |
| The9 vs. Snail, Class A | The9 vs. BeLive Holdings Ordinary | The9 vs. SaverOne 2014 Ltd | The9 vs. mF International Limited |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
Other Complementary Tools
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments |