Correlation Between LG DAX and LG DAX
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By analyzing existing cross correlation between LG DAX Daily and LG DAX Daily, you can compare the effects of market volatilities on LG DAX and LG DAX 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 LG DAX with a short position of LG DAX. Check out your portfolio center. Please also check ongoing floating volatility patterns of LG DAX and LG DAX.
Diversification Opportunities for LG DAX and LG DAX
Very poor diversification
The 3 months correlation between DES2 and DES2 is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding LG DAX Daily and LG DAX Daily in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LG DAX Daily and LG DAX 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 LG DAX Daily are associated (or correlated) with LG DAX. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LG DAX Daily has no effect on the direction of LG DAX i.e., LG DAX and LG DAX go up and down completely randomly.
Pair Corralation between LG DAX and LG DAX
Assuming the 90 days trading horizon LG DAX is expected to generate 1.44 times less return on investment than LG DAX. In addition to that, LG DAX is 1.18 times more volatile than LG DAX Daily. It trades about 0.06 of its total potential returns per unit of risk. LG DAX Daily is currently generating about 0.09 per unit of volatility. If you would invest 97.00 in LG DAX Daily on August 24, 2024 and sell it today you would earn a total of 3.00 from holding LG DAX Daily or generate 3.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
LG DAX Daily vs. LG DAX Daily
Performance |
| Timeline |
| LG DAX Daily |
| LG DAX Daily |
LG DAX and LG DAX Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LG DAX and LG DAX
The main advantage of trading using opposite LG DAX and LG DAX positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LG DAX position performs unexpectedly, LG DAX 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 LG DAX will offset losses from the drop in LG DAX's long position.| LG DAX vs. UBS Fund Solutions | LG DAX vs. Xtrackers II | LG DAX vs. Xtrackers Nikkei 225 | LG DAX vs. iShares VII PLC |
| LG DAX vs. LG DAX Daily | LG DAX vs. iShares Govt Bond | LG DAX vs. Amundi MSCI Europe | LG DAX vs. iShares Global AAA AA |
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 Stocks Directory module to find actively traded stocks across global markets.
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