Correlation Between DAX Index and Lifeway Foods
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By analyzing existing cross correlation between DAX Index and Lifeway Foods, you can compare the effects of market volatilities on DAX Index and Lifeway Foods 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 Lifeway Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and Lifeway Foods.
Diversification Opportunities for DAX Index and Lifeway Foods
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between DAX and Lifeway is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and Lifeway Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lifeway Foods 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 Lifeway Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lifeway Foods has no effect on the direction of DAX Index i.e., DAX Index and Lifeway Foods go up and down completely randomly.
Pair Corralation between DAX Index and Lifeway Foods
Assuming the 90 days trading horizon DAX Index is expected to generate 9.36 times less return on investment than Lifeway Foods. But when comparing it to its historical volatility, DAX Index is 7.49 times less risky than Lifeway Foods. It trades about 0.08 of its potential returns per unit of risk. Lifeway Foods is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 570.00 in Lifeway Foods on August 28, 2024 and sell it today you would earn a total of 1,730 from holding Lifeway Foods or generate 303.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.72% |
| Values | Daily Returns |
DAX Index vs. Lifeway Foods
Performance |
| Timeline |
DAX Index and Lifeway Foods Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
Lifeway Foods
Pair trading matchups for Lifeway Foods
Pair Trading with DAX Index and Lifeway Foods
The main advantage of trading using opposite DAX Index and Lifeway Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, Lifeway Foods 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 Lifeway Foods will offset losses from the drop in Lifeway Foods' long position.| DAX Index vs. ELMOS SEMICONDUCTOR | DAX Index vs. ALTAIR RES INC | DAX Index vs. Fair Isaac Corp | DAX Index vs. Taiwan Semiconductor Manufacturing |
| Lifeway Foods vs. Superior Plus Corp | Lifeway Foods vs. NMI Holdings | Lifeway Foods vs. Origin Agritech | Lifeway Foods vs. SIVERS SEMICONDUCTORS AB |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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