Correlation Between Xtrackers LevDAX and Data Modul
Can any of the company-specific risk be diversified away by investing in both Xtrackers LevDAX and Data Modul 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 Data Modul into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xtrackers LevDAX and Data Modul AG, you can compare the effects of market volatilities on Xtrackers LevDAX and Data Modul 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 Data Modul. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xtrackers LevDAX and Data Modul.
Diversification Opportunities for Xtrackers LevDAX and Data Modul
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Xtrackers and Data is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Xtrackers LevDAX and Data Modul AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Data Modul AG 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 Data Modul. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Data Modul AG has no effect on the direction of Xtrackers LevDAX i.e., Xtrackers LevDAX and Data Modul go up and down completely randomly.
Pair Corralation between Xtrackers LevDAX and Data Modul
Assuming the 90 days trading horizon Xtrackers LevDAX is expected to generate 0.69 times more return on investment than Data Modul. However, Xtrackers LevDAX is 1.46 times less risky than Data Modul. It trades about 0.6 of its potential returns per unit of risk. Data Modul AG is currently generating about -0.13 per unit of risk. If you would invest 20,015 in Xtrackers LevDAX on November 3, 2024 and sell it today you would earn a total of 3,475 from holding Xtrackers LevDAX or generate 17.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 91.3% |
| Values | Daily Returns |
Xtrackers LevDAX vs. Data Modul AG
Performance |
| Timeline |
| Xtrackers LevDAX |
| Data Modul AG |
Xtrackers LevDAX and Data Modul Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xtrackers LevDAX and Data Modul
The main advantage of trading using opposite Xtrackers LevDAX and Data Modul positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xtrackers LevDAX position performs unexpectedly, Data Modul 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 Data Modul will offset losses from the drop in Data Modul'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 |
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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