Correlation Between DAX Index and ENTERGY
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By analyzing existing cross correlation between DAX Index and ENTERGY, you can compare the effects of market volatilities on DAX Index and ENTERGY 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 ENTERGY. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and ENTERGY.
Diversification Opportunities for DAX Index and ENTERGY
Very weak diversification
The 3 months correlation between DAX and ENTERGY is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and ENTERGY in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ENTERGY 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 ENTERGY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ENTERGY has no effect on the direction of DAX Index i.e., DAX Index and ENTERGY go up and down completely randomly.
Pair Corralation between DAX Index and ENTERGY
Assuming the 90 days trading horizon DAX Index is expected to under-perform the ENTERGY. But the index apears to be less risky and, when comparing its historical volatility, DAX Index is 2.29 times less risky than ENTERGY. The index trades about -0.02 of its potential returns per unit of risk. The ENTERGY is currently generating about 0.25 of returns per unit of risk over similar time horizon. If you would invest 7,050 in ENTERGY on October 16, 2024 and sell it today you would earn a total of 450.00 from holding ENTERGY or generate 6.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
DAX Index vs. ENTERGY
Performance |
| Timeline |
DAX Index and ENTERGY Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
ENTERGY
Pair trading matchups for ENTERGY
Pair Trading with DAX Index and ENTERGY
The main advantage of trading using opposite DAX Index and ENTERGY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, ENTERGY 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 ENTERGY will offset losses from the drop in ENTERGY's long position.| DAX Index vs. MTY Food Group | DAX Index vs. Tyson Foods | DAX Index vs. Lery Seafood Group | DAX Index vs. United States Steel |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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