Correlation Between Spirent Communications and DAX Index
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By analyzing existing cross correlation between Spirent Communications plc and DAX Index, you can compare the effects of market volatilities on Spirent Communications and DAX Index 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 Spirent Communications with a short position of DAX Index. Check out your portfolio center. Please also check ongoing floating volatility patterns of Spirent Communications and DAX Index.
Diversification Opportunities for Spirent Communications and DAX Index
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Spirent and DAX is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Spirent Communications plc and DAX Index in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DAX Index and Spirent Communications 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 Spirent Communications plc are associated (or correlated) with DAX Index. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DAX Index has no effect on the direction of Spirent Communications i.e., Spirent Communications and DAX Index go up and down completely randomly.
Pair Corralation between Spirent Communications and DAX Index
Assuming the 90 days horizon Spirent Communications plc is expected to generate 5.99 times more return on investment than DAX Index. However, Spirent Communications is 5.99 times more volatile than DAX Index. It trades about 0.05 of its potential returns per unit of risk. DAX Index is currently generating about 0.13 per unit of risk. If you would invest 136.00 in Spirent Communications plc on November 7, 2024 and sell it today you would earn a total of 72.00 from holding Spirent Communications plc or generate 52.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Spirent Communications plc vs. DAX Index
Performance |
| Timeline |
Spirent Communications and DAX Index Volatility Contrast
Predicted Return Density |
| Returns |
Spirent Communications plc
Pair trading matchups for Spirent Communications
DAX Index
Pair trading matchups for DAX Index
Pair Trading with Spirent Communications and DAX Index
The main advantage of trading using opposite Spirent Communications and DAX Index positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Spirent Communications position performs unexpectedly, DAX Index 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 DAX Index will offset losses from the drop in DAX Index's long position.| Spirent Communications vs. EPSILON HEALTHCARE LTD | Spirent Communications vs. RCI Hospitality Holdings | Spirent Communications vs. Focus Home Interactive | Spirent Communications vs. Waste Management |
| DAX Index vs. RCI Hospitality Holdings | DAX Index vs. ecotel communication ag | DAX Index vs. Universal Health Realty | DAX Index vs. Infrastrutture Wireless Italiane |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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