Correlation Between DAX Index and Powercell Sweden
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By analyzing existing cross correlation between DAX Index and Powercell Sweden, you can compare the effects of market volatilities on DAX Index and Powercell Sweden 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 Powercell Sweden. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and Powercell Sweden.
Diversification Opportunities for DAX Index and Powercell Sweden
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between DAX and Powercell is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and Powercell Sweden in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Powercell Sweden 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 Powercell Sweden. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Powercell Sweden has no effect on the direction of DAX Index i.e., DAX Index and Powercell Sweden go up and down completely randomly.
Pair Corralation between DAX Index and Powercell Sweden
Assuming the 90 days trading horizon DAX Index is expected to generate 0.16 times more return on investment than Powercell Sweden. However, DAX Index is 6.24 times less risky than Powercell Sweden. It trades about 0.08 of its potential returns per unit of risk. Powercell Sweden is currently generating about -0.01 per unit of risk. If you would invest 1,675,164 in DAX Index on August 25, 2024 and sell it today you would earn a total of 257,095 from holding DAX Index or generate 15.35% 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. Powercell Sweden
Performance |
| Timeline |
DAX Index and Powercell Sweden Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
Powercell Sweden
Pair trading matchups for Powercell Sweden
Pair Trading with DAX Index and Powercell Sweden
The main advantage of trading using opposite DAX Index and Powercell Sweden positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, Powercell Sweden 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 Powercell Sweden will offset losses from the drop in Powercell Sweden's long position.| DAX Index vs. Granite Construction | DAX Index vs. AGRICULTBK HADR25 YC | DAX Index vs. ADRIATIC METALS LS 013355 | DAX Index vs. GREENX METALS LTD |
| Powercell Sweden vs. YASKAWA ELEC UNSP | Powercell Sweden vs. Varta AG | Powercell Sweden vs. OSRAM LICHT N | Powercell Sweden vs. Bloom Energy |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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