Correlation Between Leverage Shares and Xtrackers Nikkei
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By analyzing existing cross correlation between Leverage Shares 3x and Xtrackers Nikkei 225, you can compare the effects of market volatilities on Leverage Shares and Xtrackers Nikkei 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 Leverage Shares with a short position of Xtrackers Nikkei. Check out your portfolio center. Please also check ongoing floating volatility patterns of Leverage Shares and Xtrackers Nikkei.
Diversification Opportunities for Leverage Shares and Xtrackers Nikkei
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Leverage and Xtrackers is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Leverage Shares 3x and Xtrackers Nikkei 225 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xtrackers Nikkei 225 and Leverage Shares 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 Leverage Shares 3x are associated (or correlated) with Xtrackers Nikkei. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xtrackers Nikkei 225 has no effect on the direction of Leverage Shares i.e., Leverage Shares and Xtrackers Nikkei go up and down completely randomly.
Pair Corralation between Leverage Shares and Xtrackers Nikkei
Assuming the 90 days trading horizon Leverage Shares 3x is expected to generate 3.84 times more return on investment than Xtrackers Nikkei. However, Leverage Shares is 3.84 times more volatile than Xtrackers Nikkei 225. It trades about 0.13 of its potential returns per unit of risk. Xtrackers Nikkei 225 is currently generating about 0.01 per unit of risk. If you would invest 4,659 in Leverage Shares 3x on September 3, 2024 and sell it today you would earn a total of 6,147 from holding Leverage Shares 3x or generate 131.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.41% |
| Values | Daily Returns |
Leverage Shares 3x vs. Xtrackers Nikkei 225
Performance |
| Timeline |
| Leverage Shares 3x |
| Xtrackers Nikkei 225 |
Leverage Shares and Xtrackers Nikkei Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Leverage Shares and Xtrackers Nikkei
The main advantage of trading using opposite Leverage Shares and Xtrackers Nikkei positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Leverage Shares position performs unexpectedly, Xtrackers Nikkei 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 Xtrackers Nikkei will offset losses from the drop in Xtrackers Nikkei's long position.| Leverage Shares vs. UBS Fund Solutions | Leverage Shares vs. Xtrackers II | Leverage Shares vs. Xtrackers Nikkei 225 | Leverage Shares vs. iShares VII PLC |
| Xtrackers Nikkei vs. UBS Fund Solutions | Xtrackers Nikkei vs. Xtrackers II | Xtrackers Nikkei vs. iShares VII PLC | Xtrackers Nikkei vs. SPDR Gold Shares |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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