Correlation Between Xtrackers LevDAX and NEXA RESOURCES
Can any of the company-specific risk be diversified away by investing in both Xtrackers LevDAX and NEXA RESOURCES 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 NEXA RESOURCES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xtrackers LevDAX and NEXA RESOURCES SA, you can compare the effects of market volatilities on Xtrackers LevDAX and NEXA RESOURCES 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 NEXA RESOURCES. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xtrackers LevDAX and NEXA RESOURCES.
Diversification Opportunities for Xtrackers LevDAX and NEXA RESOURCES
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Xtrackers and NEXA is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Xtrackers LevDAX and NEXA RESOURCES SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NEXA RESOURCES SA 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 NEXA RESOURCES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NEXA RESOURCES SA has no effect on the direction of Xtrackers LevDAX i.e., Xtrackers LevDAX and NEXA RESOURCES go up and down completely randomly.
Pair Corralation between Xtrackers LevDAX and NEXA RESOURCES
Assuming the 90 days trading horizon Xtrackers LevDAX is expected to generate 0.61 times more return on investment than NEXA RESOURCES. However, Xtrackers LevDAX is 1.65 times less risky than NEXA RESOURCES. It trades about 0.12 of its potential returns per unit of risk. NEXA RESOURCES SA is currently generating about 0.0 per unit of risk. If you would invest 14,846 in Xtrackers LevDAX on November 9, 2024 and sell it today you would earn a total of 8,494 from holding Xtrackers LevDAX or generate 57.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xtrackers LevDAX vs. NEXA RESOURCES SA
Performance |
| Timeline |
| Xtrackers LevDAX |
| NEXA RESOURCES SA |
Xtrackers LevDAX and NEXA RESOURCES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xtrackers LevDAX and NEXA RESOURCES
The main advantage of trading using opposite Xtrackers LevDAX and NEXA RESOURCES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xtrackers LevDAX position performs unexpectedly, NEXA RESOURCES 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 NEXA RESOURCES will offset losses from the drop in NEXA RESOURCES'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 |
| NEXA RESOURCES vs. Marie Brizard Wine | NEXA RESOURCES vs. Treasury Wine Estates | NEXA RESOURCES vs. Universal Health Realty | NEXA RESOURCES vs. COREBRIDGE FINANCIAL INC |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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