Correlation Between DAX Index and Hochschild Mining
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By analyzing existing cross correlation between DAX Index and Hochschild Mining plc, you can compare the effects of market volatilities on DAX Index and Hochschild Mining 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 Hochschild Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and Hochschild Mining.
Diversification Opportunities for DAX Index and Hochschild Mining
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between DAX and Hochschild is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and Hochschild Mining plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hochschild Mining plc 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 Hochschild Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hochschild Mining plc has no effect on the direction of DAX Index i.e., DAX Index and Hochschild Mining go up and down completely randomly.
Pair Corralation between DAX Index and Hochschild Mining
Assuming the 90 days trading horizon DAX Index is expected to generate 5.14 times less return on investment than Hochschild Mining. But when comparing it to its historical volatility, DAX Index is 4.56 times less risky than Hochschild Mining. It trades about 0.08 of its potential returns per unit of risk. Hochschild Mining plc is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 75.00 in Hochschild Mining plc on August 30, 2024 and sell it today you would earn a total of 188.00 from holding Hochschild Mining plc or generate 250.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
DAX Index vs. Hochschild Mining plc
Performance |
| Timeline |
DAX Index and Hochschild Mining Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
Hochschild Mining plc
Pair trading matchups for Hochschild Mining
Pair Trading with DAX Index and Hochschild Mining
The main advantage of trading using opposite DAX Index and Hochschild Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, Hochschild Mining 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 Hochschild Mining will offset losses from the drop in Hochschild Mining's long position.| DAX Index vs. Gladstone Investment | DAX Index vs. REINET INVESTMENTS SCA | DAX Index vs. CarsalesCom | DAX Index vs. MARKET VECTR RETAIL |
| Hochschild Mining vs. Franco Nevada | Hochschild Mining vs. Wheaton Precious Metals | Hochschild Mining vs. Superior Plus Corp | Hochschild Mining vs. NMI Holdings |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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