Correlation Between DAX Index and Australian Agricultural
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By analyzing existing cross correlation between DAX Index and Australian Agricultural, you can compare the effects of market volatilities on DAX Index and Australian Agricultural 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 Australian Agricultural. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and Australian Agricultural.
Diversification Opportunities for DAX Index and Australian Agricultural
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between DAX and Australian is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and Australian Agricultural in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Australian Agricultural 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 Australian Agricultural. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Australian Agricultural has no effect on the direction of DAX Index i.e., DAX Index and Australian Agricultural go up and down completely randomly.
Pair Corralation between DAX Index and Australian Agricultural
Assuming the 90 days trading horizon DAX Index is expected to under-perform the Australian Agricultural. But the index apears to be less risky and, when comparing its historical volatility, DAX Index is 2.16 times less risky than Australian Agricultural. The index trades about -0.05 of its potential returns per unit of risk. The Australian Agricultural is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 84.00 in Australian Agricultural on August 28, 2024 and sell it today you would earn a total of 0.00 from holding Australian Agricultural or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
DAX Index vs. Australian Agricultural
Performance |
| Timeline |
DAX Index and Australian Agricultural Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
Australian Agricultural
Pair trading matchups for Australian Agricultural
Pair Trading with DAX Index and Australian Agricultural
The main advantage of trading using opposite DAX Index and Australian Agricultural positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, Australian Agricultural 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 Australian Agricultural will offset losses from the drop in Australian Agricultural's 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 |
| Australian Agricultural vs. Virtus Investment Partners | Australian Agricultural vs. Gladstone Investment | Australian Agricultural vs. EAT WELL INVESTMENT | Australian Agricultural vs. Seven West Media |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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