Correlation Between Xtrackers ShortDAX and JD
Can any of the company-specific risk be diversified away by investing in both Xtrackers ShortDAX and JD 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 ShortDAX and JD into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xtrackers ShortDAX and JD Inc, you can compare the effects of market volatilities on Xtrackers ShortDAX and JD 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 ShortDAX with a short position of JD. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xtrackers ShortDAX and JD.
Diversification Opportunities for Xtrackers ShortDAX and JD
-0.79 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Xtrackers and JD is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding Xtrackers ShortDAX and JD Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JD Inc and Xtrackers ShortDAX 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 ShortDAX are associated (or correlated) with JD. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JD Inc has no effect on the direction of Xtrackers ShortDAX i.e., Xtrackers ShortDAX and JD go up and down completely randomly.
Pair Corralation between Xtrackers ShortDAX and JD
Assuming the 90 days trading horizon Xtrackers ShortDAX is expected to under-perform the JD. But the etf apears to be less risky and, when comparing its historical volatility, Xtrackers ShortDAX is 2.07 times less risky than JD. The etf trades about -0.05 of its potential returns per unit of risk. The JD Inc is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 2,734 in JD Inc on August 31, 2024 and sell it today you would lose (993.00) from holding JD Inc or give up 36.32% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.79% |
| Values | Daily Returns |
Xtrackers ShortDAX vs. JD Inc
Performance |
| Timeline |
| Xtrackers ShortDAX |
| JD Inc |
Xtrackers ShortDAX and JD Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xtrackers ShortDAX and JD
The main advantage of trading using opposite Xtrackers ShortDAX and JD positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xtrackers ShortDAX position performs unexpectedly, JD 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 JD will offset losses from the drop in JD's long position.| Xtrackers ShortDAX vs. Xtrackers II Global | Xtrackers ShortDAX vs. Xtrackers FTSE | Xtrackers ShortDAX vs. Xtrackers SP 500 | Xtrackers ShortDAX vs. Xtrackers MSCI |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
Other Complementary Tools
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities |