Correlation Between DAX Index and POLENERGIA
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By analyzing existing cross correlation between DAX Index and POLENERGIA SA ZY, you can compare the effects of market volatilities on DAX Index and POLENERGIA 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 DAX Index with a short position of POLENERGIA. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and POLENERGIA.
Diversification Opportunities for DAX Index and POLENERGIA
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between DAX and POLENERGIA is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and POLENERGIA SA ZY in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on POLENERGIA SA ZY and DAX Index 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 DAX Index are associated (or correlated) with POLENERGIA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of POLENERGIA SA ZY has no effect on the direction of DAX Index i.e., DAX Index and POLENERGIA go up and down completely randomly.
Pair Corralation between DAX Index and POLENERGIA
Assuming the 90 days trading horizon DAX Index is expected to generate 0.37 times more return on investment than POLENERGIA. However, DAX Index is 2.7 times less risky than POLENERGIA. It trades about 0.11 of its potential returns per unit of risk. POLENERGIA SA ZY is currently generating about -0.01 per unit of risk. If you would invest 1,674,441 in DAX Index on September 14, 2024 and sell it today you would earn a total of 368,186 from holding DAX Index or generate 21.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.6% |
| Values | Daily Returns |
DAX Index vs. POLENERGIA SA ZY
Performance |
| Timeline |
DAX Index and POLENERGIA Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
POLENERGIA SA ZY
Pair trading matchups for POLENERGIA
Pair Trading with DAX Index and POLENERGIA
The main advantage of trading using opposite DAX Index and POLENERGIA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, POLENERGIA 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 POLENERGIA will offset losses from the drop in POLENERGIA's long position.| DAX Index vs. CARSALESCOM | DAX Index vs. Sumitomo Mitsui Construction | DAX Index vs. H FARM SPA | DAX Index vs. Nufarm Limited |
| POLENERGIA vs. CN YANGTPWR GDR | POLENERGIA vs. SIEMENS ENERGY AG | POLENERGIA vs. Siemens Energy AG | POLENERGIA vs. Vistra Corp |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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