Correlation Between Xtrackers MSCI and DXGE
Can any of the company-specific risk be diversified away by investing in both Xtrackers MSCI and DXGE 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 Xtrackers MSCI and DXGE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xtrackers MSCI Europe and DXGE, you can compare the effects of market volatilities on Xtrackers MSCI and DXGE 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 Xtrackers MSCI with a short position of DXGE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xtrackers MSCI and DXGE.
Diversification Opportunities for Xtrackers MSCI and DXGE
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Xtrackers and DXGE is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Xtrackers MSCI Europe and DXGE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DXGE and Xtrackers MSCI 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 Xtrackers MSCI Europe are associated (or correlated) with DXGE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DXGE has no effect on the direction of Xtrackers MSCI i.e., Xtrackers MSCI and DXGE go up and down completely randomly.
Pair Corralation between Xtrackers MSCI and DXGE
If you would invest 3,642 in DXGE on August 25, 2024 and sell it today you would earn a total of 0.00 from holding DXGE or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 4.55% |
| Values | Daily Returns |
Xtrackers MSCI Europe vs. DXGE
Performance |
| Timeline |
| Xtrackers MSCI Europe |
| DXGE |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Xtrackers MSCI and DXGE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xtrackers MSCI and DXGE
The main advantage of trading using opposite Xtrackers MSCI and DXGE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xtrackers MSCI position performs unexpectedly, DXGE 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 DXGE will offset losses from the drop in DXGE's long position.| Xtrackers MSCI vs. Xtrackers MSCI Japan | Xtrackers MSCI vs. iShares Currency Hedged | Xtrackers MSCI vs. Xtrackers MSCI EAFE | Xtrackers MSCI vs. WisdomTree Europe Hedged |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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