Correlation Between DAX Index and GrafTech International
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By analyzing existing cross correlation between DAX Index and GrafTech International, you can compare the effects of market volatilities on DAX Index and GrafTech International 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 GrafTech International. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and GrafTech International.
Diversification Opportunities for DAX Index and GrafTech International
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between DAX and GrafTech is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and GrafTech International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GrafTech International 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 GrafTech International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GrafTech International has no effect on the direction of DAX Index i.e., DAX Index and GrafTech International go up and down completely randomly.
Pair Corralation between DAX Index and GrafTech International
Assuming the 90 days trading horizon DAX Index is expected to generate 0.12 times more return on investment than GrafTech International. However, DAX Index is 8.37 times less risky than GrafTech International. It trades about 0.18 of its potential returns per unit of risk. GrafTech International is currently generating about -0.21 per unit of risk. If you would invest 1,940,520 in DAX Index on September 24, 2024 and sell it today you would earn a total of 47,955 from holding DAX Index or generate 2.47% 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. GrafTech International
Performance |
| Timeline |
DAX Index and GrafTech International Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
GrafTech International
Pair trading matchups for GrafTech International
Pair Trading with DAX Index and GrafTech International
The main advantage of trading using opposite DAX Index and GrafTech International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, GrafTech International 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 GrafTech International will offset losses from the drop in GrafTech International'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 |
| GrafTech International vs. Evolution Mining Limited | GrafTech International vs. American Airlines Group | GrafTech International vs. Clean Energy Fuels | GrafTech International vs. ALERION CLEANPOWER |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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