Correlation Between Xtrackers LevDAX and Endeavour Mining
Can any of the company-specific risk be diversified away by investing in both Xtrackers LevDAX and Endeavour Mining 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 LevDAX and Endeavour Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xtrackers LevDAX and Endeavour Mining PLC, you can compare the effects of market volatilities on Xtrackers LevDAX and Endeavour Mining 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 LevDAX with a short position of Endeavour Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xtrackers LevDAX and Endeavour Mining.
Diversification Opportunities for Xtrackers LevDAX and Endeavour Mining
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Xtrackers and Endeavour is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Xtrackers LevDAX and Endeavour Mining PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Endeavour Mining PLC and Xtrackers LevDAX 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 LevDAX are associated (or correlated) with Endeavour Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Endeavour Mining PLC has no effect on the direction of Xtrackers LevDAX i.e., Xtrackers LevDAX and Endeavour Mining go up and down completely randomly.
Pair Corralation between Xtrackers LevDAX and Endeavour Mining
Assuming the 90 days trading horizon Xtrackers LevDAX is expected to generate 0.61 times more return on investment than Endeavour Mining. However, Xtrackers LevDAX is 1.65 times less risky than Endeavour Mining. It trades about 0.07 of its potential returns per unit of risk. Endeavour Mining PLC is currently generating about 0.0 per unit of risk. If you would invest 13,070 in Xtrackers LevDAX on October 13, 2024 and sell it today you would earn a total of 7,715 from holding Xtrackers LevDAX or generate 59.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Xtrackers LevDAX vs. Endeavour Mining PLC
Performance |
| Timeline |
| Xtrackers LevDAX |
| Endeavour Mining PLC |
Xtrackers LevDAX and Endeavour Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xtrackers LevDAX and Endeavour Mining
The main advantage of trading using opposite Xtrackers LevDAX and Endeavour Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xtrackers LevDAX position performs unexpectedly, Endeavour Mining 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 Endeavour Mining will offset losses from the drop in Endeavour Mining's long position.| Xtrackers LevDAX vs. Xtrackers II Global | Xtrackers LevDAX vs. Xtrackers FTSE | Xtrackers LevDAX vs. Xtrackers SP 500 | Xtrackers LevDAX vs. Xtrackers MSCI |
| Endeavour Mining vs. Dairy Farm International | Endeavour Mining vs. VIENNA INSURANCE GR | Endeavour Mining vs. WIMFARM SA EO | Endeavour Mining vs. Vienna Insurance Group |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
Other Complementary Tools
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios |