Correlation Between DAX Index and St James’s
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By analyzing existing cross correlation between DAX Index and St Jamess Place, you can compare the effects of market volatilities on DAX Index and St James’s 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 St James’s. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and St James’s.
Diversification Opportunities for DAX Index and St James’s
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between DAX and 1IV is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and St Jamess Place in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on St Jamess Place 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 St James’s. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of St Jamess Place has no effect on the direction of DAX Index i.e., DAX Index and St James’s go up and down completely randomly.
Pair Corralation between DAX Index and St James’s
Assuming the 90 days trading horizon DAX Index is expected to generate 1.37 times less return on investment than St James’s. But when comparing it to its historical volatility, DAX Index is 2.41 times less risky than St James’s. It trades about 0.53 of its potential returns per unit of risk. St Jamess Place is currently generating about 0.3 of returns per unit of risk over similar time horizon. If you would invest 974.00 in St Jamess Place on September 14, 2024 and sell it today you would earn a total of 99.00 from holding St Jamess Place or generate 10.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
DAX Index vs. St Jamess Place
Performance |
| Timeline |
DAX Index and St James’s Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
St Jamess Place
Pair trading matchups for St James’s
Pair Trading with DAX Index and St James’s
The main advantage of trading using opposite DAX Index and St James’s positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, St James’s 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 St James’s will offset losses from the drop in St James’s' long position.| DAX Index vs. CARSALESCOM | DAX Index vs. Sumitomo Mitsui Construction | DAX Index vs. H FARM SPA | DAX Index vs. Nufarm Limited |
| St James’s vs. Cogent Communications Holdings | St James’s vs. Mobilezone Holding AG | St James’s vs. Digilife Technologies Limited | St James’s vs. ACCSYS TECHPLC EO |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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