Correlation Between DAX Index and Heartland Financial
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By analyzing existing cross correlation between DAX Index and Heartland Financial USA, you can compare the effects of market volatilities on DAX Index and Heartland Financial 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 Heartland Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and Heartland Financial.
Diversification Opportunities for DAX Index and Heartland Financial
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between DAX and Heartland is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and Heartland Financial USA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Heartland Financial USA 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 Heartland Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Heartland Financial USA has no effect on the direction of DAX Index i.e., DAX Index and Heartland Financial go up and down completely randomly.
Pair Corralation between DAX Index and Heartland Financial
Assuming the 90 days trading horizon DAX Index is expected to generate 4.64 times less return on investment than Heartland Financial. But when comparing it to its historical volatility, DAX Index is 3.16 times less risky than Heartland Financial. It trades about 0.09 of its potential returns per unit of risk. Heartland Financial USA is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 3,051 in Heartland Financial USA on September 2, 2024 and sell it today you would earn a total of 3,299 from holding Heartland Financial USA or generate 108.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
DAX Index vs. Heartland Financial USA
Performance |
| Timeline |
DAX Index and Heartland Financial Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
Heartland Financial USA
Pair trading matchups for Heartland Financial
Pair Trading with DAX Index and Heartland Financial
The main advantage of trading using opposite DAX Index and Heartland Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, Heartland Financial 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 Heartland Financial will offset losses from the drop in Heartland Financial's long position.| DAX Index vs. FEMALE HEALTH | DAX Index vs. CDN IMPERIAL BANK | DAX Index vs. Webster Financial | DAX Index vs. Cardinal Health |
| Heartland Financial vs. UNICREDIT SPA ADR | Heartland Financial vs. Deutsche Bank Aktiengesellschaft | Heartland Financial vs. Superior Plus Corp | Heartland Financial vs. Origin Agritech |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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