Correlation Between Xtrackers ShortDAX and Keysight Technologies
Can any of the company-specific risk be diversified away by investing in both Xtrackers ShortDAX and Keysight Technologies 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 Keysight Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xtrackers ShortDAX and Keysight Technologies, you can compare the effects of market volatilities on Xtrackers ShortDAX and Keysight Technologies 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 Keysight Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xtrackers ShortDAX and Keysight Technologies.
Diversification Opportunities for Xtrackers ShortDAX and Keysight Technologies
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Xtrackers and Keysight is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Xtrackers ShortDAX and Keysight Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Keysight Technologies 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 Keysight Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Keysight Technologies has no effect on the direction of Xtrackers ShortDAX i.e., Xtrackers ShortDAX and Keysight Technologies go up and down completely randomly.
Pair Corralation between Xtrackers ShortDAX and Keysight Technologies
Assuming the 90 days trading horizon Xtrackers ShortDAX is expected to under-perform the Keysight Technologies. But the etf apears to be less risky and, when comparing its historical volatility, Xtrackers ShortDAX is 1.24 times less risky than Keysight Technologies. The etf trades about -0.02 of its potential returns per unit of risk. The Keysight Technologies is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 12,580 in Keysight Technologies on September 3, 2024 and sell it today you would earn a total of 3,796 from holding Keysight Technologies or generate 30.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xtrackers ShortDAX vs. Keysight Technologies
Performance |
| Timeline |
| Xtrackers ShortDAX |
| Keysight Technologies |
Xtrackers ShortDAX and Keysight Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xtrackers ShortDAX and Keysight Technologies
The main advantage of trading using opposite Xtrackers ShortDAX and Keysight Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xtrackers ShortDAX position performs unexpectedly, Keysight Technologies 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 Keysight Technologies will offset losses from the drop in Keysight Technologies' long position.| Xtrackers ShortDAX vs. Xtrackers II Global | Xtrackers ShortDAX vs. Xtrackers FTSE | Xtrackers ShortDAX vs. Xtrackers SP 500 | Xtrackers ShortDAX vs. Xtrackers MSCI |
| Keysight Technologies vs. Neinor Homes SA | Keysight Technologies vs. Gamma Communications plc | Keysight Technologies vs. MAVEN WIRELESS SWEDEN | Keysight Technologies vs. Cogent Communications Holdings |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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