Correlation Between DAX Index and Flight Centre
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By analyzing existing cross correlation between DAX Index and Flight Centre Travel, you can compare the effects of market volatilities on DAX Index and Flight Centre 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 Flight Centre. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and Flight Centre.
Diversification Opportunities for DAX Index and Flight Centre
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between DAX and Flight is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and Flight Centre Travel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Flight Centre Travel 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 Flight Centre. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Flight Centre Travel has no effect on the direction of DAX Index i.e., DAX Index and Flight Centre go up and down completely randomly.
Pair Corralation between DAX Index and Flight Centre
Assuming the 90 days trading horizon DAX Index is expected to generate 0.39 times more return on investment than Flight Centre. However, DAX Index is 2.54 times less risky than Flight Centre. It trades about 0.08 of its potential returns per unit of risk. Flight Centre Travel is currently generating about 0.03 per unit of risk. If you would invest 1,437,072 in DAX Index on August 30, 2024 and sell it today you would earn a total of 489,103 from holding DAX Index or generate 34.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
DAX Index vs. Flight Centre Travel
Performance |
| Timeline |
DAX Index and Flight Centre Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
Flight Centre Travel
Pair trading matchups for Flight Centre
Pair Trading with DAX Index and Flight Centre
The main advantage of trading using opposite DAX Index and Flight Centre positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, Flight Centre 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 Flight Centre will offset losses from the drop in Flight Centre's long position.| DAX Index vs. Gladstone Investment | DAX Index vs. REINET INVESTMENTS SCA | DAX Index vs. CarsalesCom | DAX Index vs. MARKET VECTR RETAIL |
| Flight Centre vs. Aedas Homes SA | Flight Centre vs. Haverty Furniture Companies | Flight Centre vs. WILLIS LEASE FIN | Flight Centre vs. UNITED RENTALS |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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