Correlation Between Beta MWIG40TR and ADX
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By analyzing existing cross correlation between Beta mWIG40TR Portfelowy and ADX, you can compare the effects of market volatilities on Beta MWIG40TR and ADX 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 Beta MWIG40TR with a short position of ADX. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beta MWIG40TR and ADX.
Diversification Opportunities for Beta MWIG40TR and ADX
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Beta and ADX is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Beta mWIG40TR Portfelowy and ADX in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ADX and Beta MWIG40TR 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 Beta mWIG40TR Portfelowy are associated (or correlated) with ADX. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ADX has no effect on the direction of Beta MWIG40TR i.e., Beta MWIG40TR and ADX go up and down completely randomly.
Pair Corralation between Beta MWIG40TR and ADX
Assuming the 90 days trading horizon Beta MWIG40TR is expected to generate 7.97 times less return on investment than ADX. But when comparing it to its historical volatility, Beta mWIG40TR Portfelowy is 4.33 times less risky than ADX. It trades about 0.05 of its potential returns per unit of risk. ADX is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 25.00 in ADX on August 31, 2024 and sell it today you would earn a total of 1.00 from holding ADX or generate 4.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 75.0% |
| Values | Daily Returns |
Beta mWIG40TR Portfelowy vs. ADX
Performance |
| Timeline |
| Beta mWIG40TR Portfelowy |
| ADX |
Beta MWIG40TR and ADX Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Beta MWIG40TR and ADX
The main advantage of trading using opposite Beta MWIG40TR and ADX positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beta MWIG40TR position performs unexpectedly, ADX 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 ADX will offset losses from the drop in ADX's long position.| Beta MWIG40TR vs. Asseco Business Solutions | Beta MWIG40TR vs. Detalion Games SA | Beta MWIG40TR vs. Asseco South Eastern | Beta MWIG40TR vs. CFI Holding SA |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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