Correlation Between Xtrackers ShortDAX and Kroger
Can any of the company-specific risk be diversified away by investing in both Xtrackers ShortDAX and Kroger 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 Kroger into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xtrackers ShortDAX and The Kroger Co, you can compare the effects of market volatilities on Xtrackers ShortDAX and Kroger 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 Kroger. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xtrackers ShortDAX and Kroger.
Diversification Opportunities for Xtrackers ShortDAX and Kroger
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Xtrackers and Kroger is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Xtrackers ShortDAX and The Kroger Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on The Kroger 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 Kroger. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of The Kroger has no effect on the direction of Xtrackers ShortDAX i.e., Xtrackers ShortDAX and Kroger go up and down completely randomly.
Pair Corralation between Xtrackers ShortDAX and Kroger
Assuming the 90 days trading horizon Xtrackers ShortDAX is expected to generate 3.07 times less return on investment than Kroger. But when comparing it to its historical volatility, Xtrackers ShortDAX is 1.46 times less risky than Kroger. It trades about 0.08 of its potential returns per unit of risk. The Kroger Co is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 5,253 in The Kroger Co on August 29, 2024 and sell it today you would earn a total of 437.00 from holding The Kroger Co or generate 8.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Xtrackers ShortDAX vs. The Kroger Co
Performance |
| Timeline |
| Xtrackers ShortDAX |
| The Kroger |
Xtrackers ShortDAX and Kroger Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xtrackers ShortDAX and Kroger
The main advantage of trading using opposite Xtrackers ShortDAX and Kroger positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xtrackers ShortDAX position performs unexpectedly, Kroger 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 Kroger will offset losses from the drop in Kroger'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 |
| Kroger vs. TESCO PLC LS 0633333 | Kroger vs. Superior Plus Corp | Kroger vs. NMI Holdings | Kroger vs. SIVERS SEMICONDUCTORS AB |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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