Correlation Between DAX Index and Infosys
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By analyzing existing cross correlation between DAX Index and Infosys Limited, you can compare the effects of market volatilities on DAX Index and Infosys 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 Infosys. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and Infosys.
Diversification Opportunities for DAX Index and Infosys
Poor diversification
The 3 months correlation between DAX and Infosys is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and Infosys Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Infosys Limited 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 Infosys. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Infosys Limited has no effect on the direction of DAX Index i.e., DAX Index and Infosys go up and down completely randomly.
Pair Corralation between DAX Index and Infosys
Assuming the 90 days trading horizon DAX Index is expected to generate 12.38 times less return on investment than Infosys. But when comparing it to its historical volatility, DAX Index is 18.89 times less risky than Infosys. It trades about 0.08 of its potential returns per unit of risk. Infosys Limited is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 334.00 in Infosys Limited on October 12, 2024 and sell it today you would earn a total of 1,856 from holding Infosys Limited or generate 555.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.8% |
| Values | Daily Returns |
DAX Index vs. Infosys Limited
Performance |
| Timeline |
DAX Index and Infosys Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
Infosys Limited
Pair trading matchups for Infosys
Pair Trading with DAX Index and Infosys
The main advantage of trading using opposite DAX Index and Infosys positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, Infosys 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 Infosys will offset losses from the drop in Infosys' long position.| DAX Index vs. Eurasia Mining Plc | DAX Index vs. URBAN OUTFITTERS | DAX Index vs. MCEWEN MINING INC | DAX Index vs. ANGLO ASIAN MINING |
| Infosys vs. Align Technology | Infosys vs. Easy Software AG | Infosys vs. Aedas Homes SA | Infosys vs. Scandinavian Tobacco Group |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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