Correlation Between Xtrackers ShortDAX and Sword Group
Can any of the company-specific risk be diversified away by investing in both Xtrackers ShortDAX and Sword Group 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 Sword Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xtrackers ShortDAX and Sword Group SE, you can compare the effects of market volatilities on Xtrackers ShortDAX and Sword Group 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 Sword Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xtrackers ShortDAX and Sword Group.
Diversification Opportunities for Xtrackers ShortDAX and Sword Group
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Xtrackers and Sword is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Xtrackers ShortDAX and Sword Group SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sword Group SE 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 Sword Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sword Group SE has no effect on the direction of Xtrackers ShortDAX i.e., Xtrackers ShortDAX and Sword Group go up and down completely randomly.
Pair Corralation between Xtrackers ShortDAX and Sword Group
Assuming the 90 days trading horizon Xtrackers ShortDAX is expected to generate 1.14 times more return on investment than Sword Group. However, Xtrackers ShortDAX is 1.14 times more volatile than Sword Group SE. It trades about 0.04 of its potential returns per unit of risk. Sword Group SE is currently generating about -0.08 per unit of risk. If you would invest 83.00 in Xtrackers ShortDAX on August 30, 2024 and sell it today you would earn a total of 1.00 from holding Xtrackers ShortDAX or generate 1.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xtrackers ShortDAX vs. Sword Group SE
Performance |
| Timeline |
| Xtrackers ShortDAX |
| Sword Group SE |
Xtrackers ShortDAX and Sword Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xtrackers ShortDAX and Sword Group
The main advantage of trading using opposite Xtrackers ShortDAX and Sword Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xtrackers ShortDAX position performs unexpectedly, Sword Group 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 Sword Group will offset losses from the drop in Sword Group'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 |
| Sword Group vs. Gladstone Investment | Sword Group vs. Cleanaway Waste Management | Sword Group vs. Tsingtao Brewery | Sword Group vs. Apollo Investment Corp |
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 Channel module to use Commodity Channel Index to analyze current equity momentum.
Other Complementary Tools
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes |