Correlation Between Dow Jones and TPG RE
Can any of the company-specific risk be diversified away by investing in both Dow Jones and TPG RE 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 TPG RE 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 TPG RE Finance, you can compare the effects of market volatilities on Dow Jones and TPG RE 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 TPG RE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dow Jones and TPG RE.
Diversification Opportunities for Dow Jones and TPG RE
Modest diversification
The 3 months correlation between Dow and TPG is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Dow Jones Industrial and TPG RE Finance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TPG RE Finance 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 TPG RE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TPG RE Finance has no effect on the direction of Dow Jones i.e., Dow Jones and TPG RE go up and down completely randomly.
Pair Corralation between Dow Jones and TPG RE
Assuming the 90 days trading horizon Dow Jones Industrial is expected to generate 0.56 times more return on investment than TPG RE. However, Dow Jones Industrial is 1.78 times less risky than TPG RE. It trades about 0.11 of its potential returns per unit of risk. TPG RE Finance is currently generating about -0.01 per unit of risk. If you would invest 4,583,422 in Dow Jones Industrial on September 12, 2025 and sell it today you would earn a total of 222,353 from holding Dow Jones Industrial or generate 4.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dow Jones Industrial vs. TPG RE Finance
Performance |
| Timeline |
Dow Jones and TPG RE Volatility Contrast
Predicted Return Density |
| Returns |
Dow Jones Industrial
Pair trading matchups for Dow Jones
TPG RE Finance
Pair trading matchups for TPG RE
Pair Trading with Dow Jones and TPG RE
The main advantage of trading using opposite Dow Jones and TPG RE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dow Jones position performs unexpectedly, TPG RE 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 TPG RE will offset losses from the drop in TPG RE's long position.| Dow Jones vs. American Eagle Outfitters | Dow Jones vs. National Beverage Corp | Dow Jones vs. ICL Israel Chemicals | Dow Jones vs. Future Farm Technologies |
| TPG RE vs. AG Mortgage Investment | TPG RE vs. Ready Capital Corp | TPG RE vs. Redwood Trust | TPG RE vs. Franklin BSP Realty |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
Other Complementary Tools
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments |