Correlation Between DAX Index and Gossan Resources
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By analyzing existing cross correlation between DAX Index and Gossan Resources, you can compare the effects of market volatilities on DAX Index and Gossan Resources 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 Gossan Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and Gossan Resources.
Diversification Opportunities for DAX Index and Gossan Resources
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between DAX and Gossan is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and Gossan Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gossan Resources 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 Gossan Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gossan Resources has no effect on the direction of DAX Index i.e., DAX Index and Gossan Resources go up and down completely randomly.
Pair Corralation between DAX Index and Gossan Resources
Assuming the 90 days trading horizon DAX Index is expected to generate 2.37 times less return on investment than Gossan Resources. But when comparing it to its historical volatility, DAX Index is 1.51 times less risky than Gossan Resources. It trades about 0.2 of its potential returns per unit of risk. Gossan Resources is currently generating about 0.31 of returns per unit of risk over similar time horizon. If you would invest 1.00 in Gossan Resources on September 4, 2024 and sell it today you would earn a total of 0.10 from holding Gossan Resources or generate 10.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
DAX Index vs. Gossan Resources
Performance |
| Timeline |
DAX Index and Gossan Resources Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
Gossan Resources
Pair trading matchups for Gossan Resources
Pair Trading with DAX Index and Gossan Resources
The main advantage of trading using opposite DAX Index and Gossan Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, Gossan Resources 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 Gossan Resources will offset losses from the drop in Gossan Resources' long position.| DAX Index vs. LION ONE METALS | DAX Index vs. KENNAMETAL INC | DAX Index vs. HYATT HOTELS A | DAX Index vs. Zijin Mining Group |
| Gossan Resources vs. Hyatt Hotels | Gossan Resources vs. Choice Hotels International | Gossan Resources vs. HYATT HOTELS A | Gossan Resources vs. Evolution Mining Limited |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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