Correlation Between DAX Index and FuelCell Energy
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By analyzing existing cross correlation between DAX Index and FuelCell Energy, you can compare the effects of market volatilities on DAX Index and FuelCell Energy 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 FuelCell Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and FuelCell Energy.
Diversification Opportunities for DAX Index and FuelCell Energy
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between DAX and FuelCell is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and FuelCell Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FuelCell Energy 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 FuelCell Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FuelCell Energy has no effect on the direction of DAX Index i.e., DAX Index and FuelCell Energy go up and down completely randomly.
Pair Corralation between DAX Index and FuelCell Energy
Assuming the 90 days trading horizon DAX Index is expected to generate 0.11 times more return on investment than FuelCell Energy. However, DAX Index is 9.5 times less risky than FuelCell Energy. It trades about 0.09 of its potential returns per unit of risk. FuelCell Energy is currently generating about -0.03 per unit of risk. If you would invest 1,815,524 in DAX Index on September 24, 2024 and sell it today you would earn a total of 172,951 from holding DAX Index or generate 9.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.22% |
| Values | Daily Returns |
DAX Index vs. FuelCell Energy
Performance |
| Timeline |
DAX Index and FuelCell Energy Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
FuelCell Energy
Pair trading matchups for FuelCell Energy
Pair Trading with DAX Index and FuelCell Energy
The main advantage of trading using opposite DAX Index and FuelCell Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, FuelCell Energy 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 FuelCell Energy will offset losses from the drop in FuelCell Energy's long position.| DAX Index vs. Seven West Media | DAX Index vs. TERADATA | DAX Index vs. DICKER DATA LTD | DAX Index vs. Datang International Power |
| FuelCell Energy vs. DIVERSIFIED ROYALTY | FuelCell Energy vs. BJs Wholesale Club | FuelCell Energy vs. COSTCO WHOLESALE CDR | FuelCell Energy vs. Vastned Retail NV |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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