Correlation Between DAX Index and Guangzhou Baiyunshan
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By analyzing existing cross correlation between DAX Index and Guangzhou Baiyunshan Pharmaceutical, you can compare the effects of market volatilities on DAX Index and Guangzhou Baiyunshan 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 Guangzhou Baiyunshan. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and Guangzhou Baiyunshan.
Diversification Opportunities for DAX Index and Guangzhou Baiyunshan
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between DAX and Guangzhou is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and Guangzhou Baiyunshan Pharmaceu in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangzhou Baiyunshan 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 Guangzhou Baiyunshan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangzhou Baiyunshan has no effect on the direction of DAX Index i.e., DAX Index and Guangzhou Baiyunshan go up and down completely randomly.
Pair Corralation between DAX Index and Guangzhou Baiyunshan
Assuming the 90 days trading horizon DAX Index is expected to generate 0.39 times more return on investment than Guangzhou Baiyunshan. However, DAX Index is 2.56 times less risky than Guangzhou Baiyunshan. It trades about 0.26 of its potential returns per unit of risk. Guangzhou Baiyunshan Pharmaceutical is currently generating about 0.07 per unit of risk. If you would invest 1,944,860 in DAX Index on September 12, 2024 and sell it today you would earn a total of 95,056 from holding DAX Index or generate 4.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
DAX Index vs. Guangzhou Baiyunshan Pharmaceu
Performance |
| Timeline |
DAX Index and Guangzhou Baiyunshan Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
Guangzhou Baiyunshan Pharmaceutical
Pair trading matchups for Guangzhou Baiyunshan
Pair Trading with DAX Index and Guangzhou Baiyunshan
The main advantage of trading using opposite DAX Index and Guangzhou Baiyunshan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, Guangzhou Baiyunshan 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 Guangzhou Baiyunshan will offset losses from the drop in Guangzhou Baiyunshan's long position.| DAX Index vs. Arrow Electronics | DAX Index vs. CANON MARKETING JP | DAX Index vs. The Trade Desk | DAX Index vs. METHODE ELECTRONICS |
| Guangzhou Baiyunshan vs. KENNAMETAL INC | Guangzhou Baiyunshan vs. Zijin Mining Group | Guangzhou Baiyunshan vs. Ryanair Holdings plc | Guangzhou Baiyunshan vs. GALENA MINING LTD |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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