Correlation Between Xtrackers ShortDAX and CBRE Group
Can any of the company-specific risk be diversified away by investing in both Xtrackers ShortDAX and CBRE 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 CBRE 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 CBRE Group Class, you can compare the effects of market volatilities on Xtrackers ShortDAX and CBRE 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 CBRE Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xtrackers ShortDAX and CBRE Group.
Diversification Opportunities for Xtrackers ShortDAX and CBRE Group
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Xtrackers and CBRE is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Xtrackers ShortDAX and CBRE Group Class in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CBRE Group Class 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 CBRE Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CBRE Group Class has no effect on the direction of Xtrackers ShortDAX i.e., Xtrackers ShortDAX and CBRE Group go up and down completely randomly.
Pair Corralation between Xtrackers ShortDAX and CBRE Group
Assuming the 90 days trading horizon Xtrackers ShortDAX is expected to under-perform the CBRE Group. But the etf apears to be less risky and, when comparing its historical volatility, Xtrackers ShortDAX is 1.15 times less risky than CBRE Group. The etf trades about -0.02 of its potential returns per unit of risk. The CBRE Group Class is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 8,050 in CBRE Group Class on August 30, 2024 and sell it today you would earn a total of 5,250 from holding CBRE Group Class or generate 65.22% 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. CBRE Group Class
Performance |
| Timeline |
| Xtrackers ShortDAX |
| CBRE Group Class |
Xtrackers ShortDAX and CBRE Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xtrackers ShortDAX and CBRE Group
The main advantage of trading using opposite Xtrackers ShortDAX and CBRE Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xtrackers ShortDAX position performs unexpectedly, CBRE 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 CBRE Group will offset losses from the drop in CBRE 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 |
| CBRE Group vs. Vonovia SE | CBRE Group vs. Superior Plus Corp | CBRE Group vs. NMI Holdings | CBRE Group 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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