Correlation Between DAX Index and Transcontinental
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By analyzing existing cross correlation between DAX Index and Transcontinental, you can compare the effects of market volatilities on DAX Index and Transcontinental 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 Transcontinental. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and Transcontinental.
Diversification Opportunities for DAX Index and Transcontinental
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between DAX and Transcontinental is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and Transcontinental in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Transcontinental 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 Transcontinental. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Transcontinental has no effect on the direction of DAX Index i.e., DAX Index and Transcontinental go up and down completely randomly.
Pair Corralation between DAX Index and Transcontinental
Assuming the 90 days trading horizon DAX Index is expected to generate 1.32 times less return on investment than Transcontinental. But when comparing it to its historical volatility, DAX Index is 2.42 times less risky than Transcontinental. It trades about 0.08 of its potential returns per unit of risk. Transcontinental is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 863.00 in Transcontinental on October 12, 2024 and sell it today you would earn a total of 327.00 from holding Transcontinental or generate 37.89% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 99.8% |
Values | Daily Returns |
DAX Index vs. Transcontinental
Performance |
Timeline |
DAX Index and Transcontinental Volatility Contrast
Predicted Return Density |
Returns |
DAX Index
Pair trading matchups for DAX Index
Transcontinental
Pair trading matchups for Transcontinental
Pair Trading with DAX Index and Transcontinental
The main advantage of trading using opposite DAX Index and Transcontinental positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, Transcontinental 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 Transcontinental will offset losses from the drop in Transcontinental's long position.DAX Index vs. Eurasia Mining Plc | DAX Index vs. URBAN OUTFITTERS | DAX Index vs. MCEWEN MINING INC | DAX Index vs. ANGLO ASIAN MINING |
Transcontinental vs. USWE SPORTS AB | Transcontinental vs. DELTA AIR LINES | Transcontinental vs. SYSTEMAIR AB | Transcontinental vs. Canadian Utilities Limited |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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