Correlation Between DAX Index and ITOCHU
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By analyzing existing cross correlation between DAX Index and ITOCHU, you can compare the effects of market volatilities on DAX Index and ITOCHU 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 ITOCHU. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and ITOCHU.
Diversification Opportunities for DAX Index and ITOCHU
Average diversification
The 3 months correlation between DAX and ITOCHU is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and ITOCHU in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ITOCHU 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 ITOCHU. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ITOCHU has no effect on the direction of DAX Index i.e., DAX Index and ITOCHU go up and down completely randomly.
Pair Corralation between DAX Index and ITOCHU
Assuming the 90 days trading horizon DAX Index is expected to under-perform the ITOCHU. But the index apears to be less risky and, when comparing its historical volatility, DAX Index is 2.93 times less risky than ITOCHU. The index trades about -0.3 of its potential returns per unit of risk. The ITOCHU is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 4,751 in ITOCHU on October 7, 2024 and sell it today you would earn a total of 130.00 from holding ITOCHU or generate 2.74% 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. ITOCHU
Performance |
| Timeline |
DAX Index and ITOCHU Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
ITOCHU
Pair trading matchups for ITOCHU
Pair Trading with DAX Index and ITOCHU
The main advantage of trading using opposite DAX Index and ITOCHU positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, ITOCHU 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 ITOCHU will offset losses from the drop in ITOCHU's long position.| DAX Index vs. Lery Seafood Group | DAX Index vs. Ebro Foods SA | DAX Index vs. PREMIER FOODS | DAX Index vs. SENECA FOODS A |
| ITOCHU vs. Amkor Technology | ITOCHU vs. Easy Software AG | ITOCHU vs. Addtech AB | ITOCHU vs. VELA TECHNOLPLC LS 0001 |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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