Correlation Between DAX Index and Ichor Coal
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By analyzing existing cross correlation between DAX Index and Ichor Coal NV, you can compare the effects of market volatilities on DAX Index and Ichor Coal 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 Ichor Coal. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and Ichor Coal.
Diversification Opportunities for DAX Index and Ichor Coal
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between DAX and Ichor is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and Ichor Coal NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ichor Coal NV 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 Ichor Coal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ichor Coal NV has no effect on the direction of DAX Index i.e., DAX Index and Ichor Coal go up and down completely randomly.
Pair Corralation between DAX Index and Ichor Coal
Assuming the 90 days trading horizon DAX Index is expected to generate 0.29 times more return on investment than Ichor Coal. However, DAX Index is 3.39 times less risky than Ichor Coal. It trades about 0.09 of its potential returns per unit of risk. Ichor Coal NV is currently generating about -0.14 per unit of risk. If you would invest 1,620,422 in DAX Index on September 12, 2024 and sell it today you would earn a total of 412,494 from holding DAX Index or generate 25.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.16% |
| Values | Daily Returns |
DAX Index vs. Ichor Coal NV
Performance |
| Timeline |
DAX Index and Ichor Coal Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
Ichor Coal NV
Pair trading matchups for Ichor Coal
Pair Trading with DAX Index and Ichor Coal
The main advantage of trading using opposite DAX Index and Ichor Coal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, Ichor Coal 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 Ichor Coal will offset losses from the drop in Ichor Coal'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 |
| Ichor Coal vs. CHINA SHENHUA ENA | Ichor Coal vs. China Coal Energy | Ichor Coal vs. Yancoal Australia | Ichor Coal vs. Banpu PCL |
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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