Correlation Between DAX Index and EBay
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By analyzing existing cross correlation between DAX Index and eBay Inc, you can compare the effects of market volatilities on DAX Index and EBay 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 EBay. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and EBay.
Diversification Opportunities for DAX Index and EBay
Poor diversification
The 3 months correlation between DAX and EBay is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and eBay Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on eBay Inc 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 EBay. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of eBay Inc has no effect on the direction of DAX Index i.e., DAX Index and EBay go up and down completely randomly.
Pair Corralation between DAX Index and EBay
Assuming the 90 days trading horizon DAX Index is expected to generate 6.45 times less return on investment than EBay. But when comparing it to its historical volatility, DAX Index is 1.54 times less risky than EBay. It trades about 0.1 of its potential returns per unit of risk. eBay Inc is currently generating about 0.42 of returns per unit of risk over similar time horizon. If you would invest 5,329 in eBay Inc on September 2, 2024 and sell it today you would earn a total of 719.00 from holding eBay Inc or generate 13.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
DAX Index vs. eBay Inc
Performance |
| Timeline |
DAX Index and EBay Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
eBay Inc
Pair trading matchups for EBay
Pair Trading with DAX Index and EBay
The main advantage of trading using opposite DAX Index and EBay positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, EBay 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 EBay will offset losses from the drop in EBay's long position.| DAX Index vs. FEMALE HEALTH | DAX Index vs. CDN IMPERIAL BANK | DAX Index vs. Webster Financial | DAX Index vs. Cardinal Health |
| EBay vs. SLR Investment Corp | EBay vs. Elmos Semiconductor SE | EBay vs. SPARTAN STORES | EBay vs. AOYAMA TRADING |
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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