Correlation Between Xtrackers ShortDAX and Beazley PLC
Can any of the company-specific risk be diversified away by investing in both Xtrackers ShortDAX and Beazley PLC 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 Beazley PLC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xtrackers ShortDAX and Beazley PLC, you can compare the effects of market volatilities on Xtrackers ShortDAX and Beazley PLC 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 Beazley PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xtrackers ShortDAX and Beazley PLC.
Diversification Opportunities for Xtrackers ShortDAX and Beazley PLC
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Xtrackers and Beazley is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Xtrackers ShortDAX and Beazley PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beazley PLC 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 Beazley PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beazley PLC has no effect on the direction of Xtrackers ShortDAX i.e., Xtrackers ShortDAX and Beazley PLC go up and down completely randomly.
Pair Corralation between Xtrackers ShortDAX and Beazley PLC
Assuming the 90 days trading horizon Xtrackers ShortDAX is expected to under-perform the Beazley PLC. But the etf apears to be less risky and, when comparing its historical volatility, Xtrackers ShortDAX is 1.8 times less risky than Beazley PLC. The etf trades about -0.09 of its potential returns per unit of risk. The Beazley PLC is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 598.00 in Beazley PLC on September 1, 2024 and sell it today you would earn a total of 312.00 from holding Beazley PLC or generate 52.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.64% |
| Values | Daily Returns |
Xtrackers ShortDAX vs. Beazley PLC
Performance |
| Timeline |
| Xtrackers ShortDAX |
| Beazley PLC |
Xtrackers ShortDAX and Beazley PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xtrackers ShortDAX and Beazley PLC
The main advantage of trading using opposite Xtrackers ShortDAX and Beazley PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xtrackers ShortDAX position performs unexpectedly, Beazley PLC 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 Beazley PLC will offset losses from the drop in Beazley PLC'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 |
| Beazley PLC vs. The Hanover Insurance | Beazley PLC vs. Superior Plus Corp | Beazley PLC vs. Origin Agritech | Beazley PLC vs. Identiv |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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