Correlation Between DAX Index and Archer Daniels
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By analyzing existing cross correlation between DAX Index and Archer Daniels Midland, you can compare the effects of market volatilities on DAX Index and Archer Daniels 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 Archer Daniels. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and Archer Daniels.
Diversification Opportunities for DAX Index and Archer Daniels
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between DAX and Archer is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and Archer Daniels Midland in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Archer Daniels Midland 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 Archer Daniels. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Archer Daniels Midland has no effect on the direction of DAX Index i.e., DAX Index and Archer Daniels go up and down completely randomly.
Pair Corralation between DAX Index and Archer Daniels
Assuming the 90 days trading horizon DAX Index is expected to generate 0.37 times more return on investment than Archer Daniels. However, DAX Index is 2.67 times less risky than Archer Daniels. It trades about 0.12 of its potential returns per unit of risk. Archer Daniels Midland is currently generating about -0.05 per unit of risk. If you would invest 1,578,661 in DAX Index on October 11, 2024 and sell it today you would earn a total of 454,333 from holding DAX Index or generate 28.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 97.23% |
| Values | Daily Returns |
DAX Index vs. Archer Daniels Midland
Performance |
| Timeline |
DAX Index and Archer Daniels Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
Archer Daniels Midland
Pair trading matchups for Archer Daniels
Pair Trading with DAX Index and Archer Daniels
The main advantage of trading using opposite DAX Index and Archer Daniels positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, Archer Daniels 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 Archer Daniels will offset losses from the drop in Archer Daniels' long position.| DAX Index vs. CHINA SOUTHN AIR H | DAX Index vs. Corsair Gaming | DAX Index vs. APPLIED MATERIALS | DAX Index vs. Air New Zealand |
| Archer Daniels vs. TYSON FOODS A | Archer Daniels vs. ANTA SPORTS PRODUCT | Archer Daniels vs. AEON METALS LTD | Archer Daniels vs. THAI BEVERAGE |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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