Correlation Between Xtrackers LevDAX and Kilroy Realty
Can any of the company-specific risk be diversified away by investing in both Xtrackers LevDAX and Kilroy Realty 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 Kilroy Realty into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xtrackers LevDAX and Kilroy Realty Corp, you can compare the effects of market volatilities on Xtrackers LevDAX and Kilroy Realty 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 Kilroy Realty. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xtrackers LevDAX and Kilroy Realty.
Diversification Opportunities for Xtrackers LevDAX and Kilroy Realty
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Xtrackers and Kilroy is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Xtrackers LevDAX and Kilroy Realty Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kilroy Realty Corp 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 Kilroy Realty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kilroy Realty Corp has no effect on the direction of Xtrackers LevDAX i.e., Xtrackers LevDAX and Kilroy Realty go up and down completely randomly.
Pair Corralation between Xtrackers LevDAX and Kilroy Realty
Assuming the 90 days trading horizon Xtrackers LevDAX is expected to under-perform the Kilroy Realty. But the etf apears to be less risky and, when comparing its historical volatility, Xtrackers LevDAX is 1.25 times less risky than Kilroy Realty. The etf trades about -0.01 of its potential returns per unit of risk. The Kilroy Realty Corp is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 3,640 in Kilroy Realty Corp on September 1, 2024 and sell it today you would earn a total of 220.00 from holding Kilroy Realty Corp or generate 6.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 91.3% |
| Values | Daily Returns |
Xtrackers LevDAX vs. Kilroy Realty Corp
Performance |
| Timeline |
| Xtrackers LevDAX |
| Kilroy Realty Corp |
Xtrackers LevDAX and Kilroy Realty Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xtrackers LevDAX and Kilroy Realty
The main advantage of trading using opposite Xtrackers LevDAX and Kilroy Realty positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xtrackers LevDAX position performs unexpectedly, Kilroy Realty 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 Kilroy Realty will offset losses from the drop in Kilroy Realty'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 |
| Kilroy Realty vs. TYSON FOODS A | Kilroy Realty vs. Entravision Communications | Kilroy Realty vs. CN MODERN DAIRY | Kilroy Realty vs. Ribbon Communications |
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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