Correlation Between Xtrackers ShortDAX and ZhongAn Online
Can any of the company-specific risk be diversified away by investing in both Xtrackers ShortDAX and ZhongAn Online 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 ZhongAn Online into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xtrackers ShortDAX and ZhongAn Online P, you can compare the effects of market volatilities on Xtrackers ShortDAX and ZhongAn Online 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 ZhongAn Online. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xtrackers ShortDAX and ZhongAn Online.
Diversification Opportunities for Xtrackers ShortDAX and ZhongAn Online
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Xtrackers and ZhongAn is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Xtrackers ShortDAX and ZhongAn Online P in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ZhongAn Online P 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 ZhongAn Online. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ZhongAn Online P has no effect on the direction of Xtrackers ShortDAX i.e., Xtrackers ShortDAX and ZhongAn Online go up and down completely randomly.
Pair Corralation between Xtrackers ShortDAX and ZhongAn Online
Assuming the 90 days trading horizon Xtrackers ShortDAX is expected to under-perform the ZhongAn Online. But the etf apears to be less risky and, when comparing its historical volatility, Xtrackers ShortDAX is 2.21 times less risky than ZhongAn Online. The etf trades about -0.07 of its potential returns per unit of risk. The ZhongAn Online P is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 242.00 in ZhongAn Online P on September 14, 2024 and sell it today you would lose (89.00) from holding ZhongAn Online P or give up 36.78% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Xtrackers ShortDAX vs. ZhongAn Online P
Performance |
| Timeline |
| Xtrackers ShortDAX |
| ZhongAn Online P |
Xtrackers ShortDAX and ZhongAn Online Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xtrackers ShortDAX and ZhongAn Online
The main advantage of trading using opposite Xtrackers ShortDAX and ZhongAn Online positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xtrackers ShortDAX position performs unexpectedly, ZhongAn Online 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 ZhongAn Online will offset losses from the drop in ZhongAn Online'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 |
| ZhongAn Online vs. TFS FINANCIAL | ZhongAn Online vs. WIMFARM SA EO | ZhongAn Online vs. Hitachi Construction Machinery | ZhongAn Online vs. TITAN MACHINERY |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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