Correlation Between DAX Index and EDISON INTL
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By analyzing existing cross correlation between DAX Index and EDISON INTL, you can compare the effects of market volatilities on DAX Index and EDISON INTL 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 EDISON INTL. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and EDISON INTL.
Diversification Opportunities for DAX Index and EDISON INTL
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between DAX and EDISON is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and EDISON INTL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EDISON INTL 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 EDISON INTL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EDISON INTL has no effect on the direction of DAX Index i.e., DAX Index and EDISON INTL go up and down completely randomly.
Pair Corralation between DAX Index and EDISON INTL
Assuming the 90 days trading horizon DAX Index is expected to under-perform the EDISON INTL. But the index apears to be less risky and, when comparing its historical volatility, DAX Index is 1.77 times less risky than EDISON INTL. The index trades about 0.0 of its potential returns per unit of risk. The EDISON INTL is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 7,635 in EDISON INTL on August 29, 2024 and sell it today you would earn a total of 667.00 from holding EDISON INTL or generate 8.74% 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. EDISON INTL
Performance |
| Timeline |
DAX Index and EDISON INTL Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
EDISON INTL
Pair trading matchups for EDISON INTL
Pair Trading with DAX Index and EDISON INTL
The main advantage of trading using opposite DAX Index and EDISON INTL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, EDISON INTL 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 EDISON INTL will offset losses from the drop in EDISON INTL's long position.| DAX Index vs. Gladstone Investment | DAX Index vs. REINET INVESTMENTS SCA | DAX Index vs. CarsalesCom | DAX Index vs. MARKET VECTR RETAIL |
| EDISON INTL vs. PARKEN Sport Entertainment | EDISON INTL vs. MOLSON RS BEVERAGE | EDISON INTL vs. COLUMBIA SPORTSWEAR | EDISON INTL vs. Columbia Sportswear |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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