Correlation Between DAX Index and Eisai Co
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By analyzing existing cross correlation between DAX Index and Eisai Co, you can compare the effects of market volatilities on DAX Index and Eisai Co 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 Eisai Co. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and Eisai Co.
Diversification Opportunities for DAX Index and Eisai Co
Excellent diversification
The 3 months correlation between DAX and Eisai is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and Eisai Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eisai Co 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 Eisai Co. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eisai Co has no effect on the direction of DAX Index i.e., DAX Index and Eisai Co go up and down completely randomly.
Pair Corralation between DAX Index and Eisai Co
Assuming the 90 days trading horizon DAX Index is expected to generate 0.33 times more return on investment than Eisai Co. However, DAX Index is 3.02 times less risky than Eisai Co. It trades about 0.08 of its potential returns per unit of risk. Eisai Co is currently generating about -0.05 per unit of risk. If you would invest 1,449,789 in DAX Index on September 3, 2024 and sell it today you would earn a total of 512,856 from holding DAX Index or generate 35.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
DAX Index vs. Eisai Co
Performance |
| Timeline |
DAX Index and Eisai Co Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
Eisai Co
Pair trading matchups for Eisai Co
Pair Trading with DAX Index and Eisai Co
The main advantage of trading using opposite DAX Index and Eisai Co positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, Eisai Co 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 Eisai Co will offset losses from the drop in Eisai Co's long position.| DAX Index vs. SPORT LISBOA E | DAX Index vs. FUYO GENERAL LEASE | DAX Index vs. Live Nation Entertainment | DAX Index vs. Transport International Holdings |
| Eisai Co vs. NorAm Drilling AS | Eisai Co vs. CompuGroup Medical SE | Eisai Co vs. 24SEVENOFFICE GROUP AB | Eisai Co vs. Beazer Homes USA |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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