Correlation Between Xtrackers ShortDAX and Global X
Can any of the company-specific risk be diversified away by investing in both Xtrackers ShortDAX and Global X 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 Global X into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xtrackers ShortDAX and Global X Cybersecurity, you can compare the effects of market volatilities on Xtrackers ShortDAX and Global X 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 Global X. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xtrackers ShortDAX and Global X.
Diversification Opportunities for Xtrackers ShortDAX and Global X
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Xtrackers and Global is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Xtrackers ShortDAX and Global X Cybersecurity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global X Cybersecurity 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 Global X. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global X Cybersecurity has no effect on the direction of Xtrackers ShortDAX i.e., Xtrackers ShortDAX and Global X go up and down completely randomly.
Pair Corralation between Xtrackers ShortDAX and Global X
Assuming the 90 days trading horizon Xtrackers ShortDAX is expected to under-perform the Global X. But the etf apears to be less risky and, when comparing its historical volatility, Xtrackers ShortDAX is 1.01 times less risky than Global X. The etf trades about -0.51 of its potential returns per unit of risk. The Global X Cybersecurity is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 1,429 in Global X Cybersecurity on September 14, 2024 and sell it today you would earn a total of 21.00 from holding Global X Cybersecurity or generate 1.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 91.3% |
| Values | Daily Returns |
Xtrackers ShortDAX vs. Global X Cybersecurity
Performance |
| Timeline |
| Xtrackers ShortDAX |
| Global X Cybersecurity |
Xtrackers ShortDAX and Global X Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xtrackers ShortDAX and Global X
The main advantage of trading using opposite Xtrackers ShortDAX and Global X positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xtrackers ShortDAX position performs unexpectedly, Global X 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 Global X will offset losses from the drop in Global X'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 |
| Global X vs. Global X China | Global X vs. Global X Aave | Global X vs. Global X NASDAQ | Global X vs. Global X Cloud |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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