Correlation Between DAX Index and Hufvudstaden
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By analyzing existing cross correlation between DAX Index and Hufvudstaden AB, you can compare the effects of market volatilities on DAX Index and Hufvudstaden 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 Hufvudstaden. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and Hufvudstaden.
Diversification Opportunities for DAX Index and Hufvudstaden
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between DAX and Hufvudstaden is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and Hufvudstaden AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hufvudstaden AB 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 Hufvudstaden. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hufvudstaden AB has no effect on the direction of DAX Index i.e., DAX Index and Hufvudstaden go up and down completely randomly.
Pair Corralation between DAX Index and Hufvudstaden
Assuming the 90 days trading horizon DAX Index is expected to generate 0.53 times more return on investment than Hufvudstaden. However, DAX Index is 1.87 times less risky than Hufvudstaden. It trades about 0.05 of its potential returns per unit of risk. Hufvudstaden AB is currently generating about 0.0 per unit of risk. If you would invest 1,831,897 in DAX Index on September 3, 2024 and sell it today you would earn a total of 130,748 from holding DAX Index or generate 7.14% 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. Hufvudstaden AB
Performance |
| Timeline |
DAX Index and Hufvudstaden Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
Hufvudstaden AB
Pair trading matchups for Hufvudstaden
Pair Trading with DAX Index and Hufvudstaden
The main advantage of trading using opposite DAX Index and Hufvudstaden positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, Hufvudstaden 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 Hufvudstaden will offset losses from the drop in Hufvudstaden's long position.| DAX Index vs. SPORT LISBOA E | DAX Index vs. FUYO GENERAL LEASE | DAX Index vs. Live Nation Entertainment | DAX Index vs. Transport International Holdings |
| Hufvudstaden vs. GuocoLand Limited | Hufvudstaden vs. Superior Plus Corp | Hufvudstaden vs. NMI Holdings | Hufvudstaden vs. Origin Agritech |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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