Correlation Between DAX Index and Air Products
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By analyzing existing cross correlation between DAX Index and Air Products and, you can compare the effects of market volatilities on DAX Index and Air Products 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 Air Products. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and Air Products.
Diversification Opportunities for DAX Index and Air Products
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between DAX and Air is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and Air Products and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Air Products 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 Air Products. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Air Products has no effect on the direction of DAX Index i.e., DAX Index and Air Products go up and down completely randomly.
Pair Corralation between DAX Index and Air Products
Assuming the 90 days trading horizon DAX Index is expected to generate 0.48 times more return on investment than Air Products. However, DAX Index is 2.08 times less risky than Air Products. It trades about 0.08 of its potential returns per unit of risk. Air Products and is currently generating about 0.02 per unit of risk. If you would invest 1,426,119 in DAX Index on August 28, 2024 and sell it today you would earn a total of 503,479 from holding DAX Index or generate 35.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.8% |
| Values | Daily Returns |
DAX Index vs. Air Products and
Performance |
| Timeline |
DAX Index and Air Products Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
Air Products and
Pair trading matchups for Air Products
Pair Trading with DAX Index and Air Products
The main advantage of trading using opposite DAX Index and Air Products positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, Air Products 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 Air Products will offset losses from the drop in Air Products' long position.| DAX Index vs. ELMOS SEMICONDUCTOR | DAX Index vs. ALTAIR RES INC | DAX Index vs. Fair Isaac Corp | DAX Index vs. Taiwan Semiconductor Manufacturing |
| Air Products vs. Major Drilling Group | Air Products vs. CECO ENVIRONMENTAL | Air Products vs. Perma Fix Environmental Services | Air Products vs. CosmoSteel Holdings 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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