Correlation Between Xtrackers ShortDAX and Siemens Aktiengesellscha
Can any of the company-specific risk be diversified away by investing in both Xtrackers ShortDAX and Siemens Aktiengesellscha 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 Siemens Aktiengesellscha into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xtrackers ShortDAX and Siemens Aktiengesellschaft, you can compare the effects of market volatilities on Xtrackers ShortDAX and Siemens Aktiengesellscha 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 Siemens Aktiengesellscha. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xtrackers ShortDAX and Siemens Aktiengesellscha.
Diversification Opportunities for Xtrackers ShortDAX and Siemens Aktiengesellscha
-0.87 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Xtrackers and Siemens is -0.87. Overlapping area represents the amount of risk that can be diversified away by holding Xtrackers ShortDAX and Siemens Aktiengesellschaft in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Siemens Aktiengesellscha 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 Siemens Aktiengesellscha. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Siemens Aktiengesellscha has no effect on the direction of Xtrackers ShortDAX i.e., Xtrackers ShortDAX and Siemens Aktiengesellscha go up and down completely randomly.
Pair Corralation between Xtrackers ShortDAX and Siemens Aktiengesellscha
Assuming the 90 days trading horizon Xtrackers ShortDAX is expected to under-perform the Siemens Aktiengesellscha. In addition to that, Xtrackers ShortDAX is 1.06 times more volatile than Siemens Aktiengesellschaft. It trades about -0.04 of its total potential returns per unit of risk. Siemens Aktiengesellschaft is currently generating about 0.04 per unit of volatility. If you would invest 14,399 in Siemens Aktiengesellschaft on August 24, 2024 and sell it today you would earn a total of 3,251 from holding Siemens Aktiengesellschaft or generate 22.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xtrackers ShortDAX vs. Siemens Aktiengesellschaft
Performance |
| Timeline |
| Xtrackers ShortDAX |
| Siemens Aktiengesellscha |
Xtrackers ShortDAX and Siemens Aktiengesellscha Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xtrackers ShortDAX and Siemens Aktiengesellscha
The main advantage of trading using opposite Xtrackers ShortDAX and Siemens Aktiengesellscha positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xtrackers ShortDAX position performs unexpectedly, Siemens Aktiengesellscha 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 Siemens Aktiengesellscha will offset losses from the drop in Siemens Aktiengesellscha'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 |
| Siemens Aktiengesellscha vs. NAKED WINES PLC | Siemens Aktiengesellscha vs. Transportadora de Gas | Siemens Aktiengesellscha vs. EVS Broadcast Equipment | Siemens Aktiengesellscha vs. UNIVMUSIC GRPADR050 |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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