Correlation Between Xtrackers ShortDAX and FIRST NATIONAL
Can any of the company-specific risk be diversified away by investing in both Xtrackers ShortDAX and FIRST NATIONAL 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 FIRST NATIONAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xtrackers ShortDAX and FIRST NATIONAL FIN, you can compare the effects of market volatilities on Xtrackers ShortDAX and FIRST NATIONAL 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 FIRST NATIONAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xtrackers ShortDAX and FIRST NATIONAL.
Diversification Opportunities for Xtrackers ShortDAX and FIRST NATIONAL
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Xtrackers and FIRST is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Xtrackers ShortDAX and FIRST NATIONAL FIN in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FIRST NATIONAL FIN 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 FIRST NATIONAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FIRST NATIONAL FIN has no effect on the direction of Xtrackers ShortDAX i.e., Xtrackers ShortDAX and FIRST NATIONAL go up and down completely randomly.
Pair Corralation between Xtrackers ShortDAX and FIRST NATIONAL
Assuming the 90 days trading horizon Xtrackers ShortDAX is expected to generate 9.4 times less return on investment than FIRST NATIONAL. But when comparing it to its historical volatility, Xtrackers ShortDAX is 1.2 times less risky than FIRST NATIONAL. It trades about 0.04 of its potential returns per unit of risk. FIRST NATIONAL FIN is currently generating about 0.32 of returns per unit of risk over similar time horizon. If you would invest 2,680 in FIRST NATIONAL FIN on August 30, 2024 and sell it today you would earn a total of 380.00 from holding FIRST NATIONAL FIN or generate 14.18% 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. FIRST NATIONAL FIN
Performance |
| Timeline |
| Xtrackers ShortDAX |
| FIRST NATIONAL FIN |
Xtrackers ShortDAX and FIRST NATIONAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xtrackers ShortDAX and FIRST NATIONAL
The main advantage of trading using opposite Xtrackers ShortDAX and FIRST NATIONAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xtrackers ShortDAX position performs unexpectedly, FIRST NATIONAL 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 FIRST NATIONAL will offset losses from the drop in FIRST NATIONAL'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 |
| FIRST NATIONAL vs. Superior Plus Corp | FIRST NATIONAL vs. NMI Holdings | FIRST NATIONAL vs. SIVERS SEMICONDUCTORS AB | FIRST NATIONAL vs. Talanx AG |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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