Correlation Between DAX Index and INNOVATEC SPA
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By analyzing existing cross correlation between DAX Index and INNOVATEC SPA, you can compare the effects of market volatilities on DAX Index and INNOVATEC SPA 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 INNOVATEC SPA. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and INNOVATEC SPA.
Diversification Opportunities for DAX Index and INNOVATEC SPA
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between DAX and INNOVATEC is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and INNOVATEC SPA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on INNOVATEC SPA 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 INNOVATEC SPA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of INNOVATEC SPA has no effect on the direction of DAX Index i.e., DAX Index and INNOVATEC SPA go up and down completely randomly.
Pair Corralation between DAX Index and INNOVATEC SPA
Assuming the 90 days trading horizon DAX Index is expected to generate 1.83 times less return on investment than INNOVATEC SPA. But when comparing it to its historical volatility, DAX Index is 6.38 times less risky than INNOVATEC SPA. It trades about 0.26 of its potential returns per unit of risk. INNOVATEC SPA is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 81.00 in INNOVATEC SPA on September 12, 2024 and sell it today you would earn a total of 5.00 from holding INNOVATEC SPA or generate 6.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
DAX Index vs. INNOVATEC SPA
Performance |
| Timeline |
DAX Index and INNOVATEC SPA Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
INNOVATEC SPA
Pair trading matchups for INNOVATEC SPA
Pair Trading with DAX Index and INNOVATEC SPA
The main advantage of trading using opposite DAX Index and INNOVATEC SPA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, INNOVATEC SPA 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 INNOVATEC SPA will offset losses from the drop in INNOVATEC SPA's long position.| DAX Index vs. Arrow Electronics | DAX Index vs. CANON MARKETING JP | DAX Index vs. The Trade Desk | DAX Index vs. METHODE ELECTRONICS |
| INNOVATEC SPA vs. KENEDIX OFFICE INV | INNOVATEC SPA vs. PENN NATL GAMING | INNOVATEC SPA vs. GigaMedia | INNOVATEC SPA vs. FANDIFI TECHNOLOGY P |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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