Correlation Between DAX Index and Digilife Technologies
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By analyzing existing cross correlation between DAX Index and Digilife Technologies Limited, you can compare the effects of market volatilities on DAX Index and Digilife Technologies 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 Digilife Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and Digilife Technologies.
Diversification Opportunities for DAX Index and Digilife Technologies
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between DAX and Digilife is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and Digilife Technologies Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Digilife Technologies 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 Digilife Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Digilife Technologies has no effect on the direction of DAX Index i.e., DAX Index and Digilife Technologies go up and down completely randomly.
Pair Corralation between DAX Index and Digilife Technologies
Assuming the 90 days trading horizon DAX Index is expected to generate 1.32 times less return on investment than Digilife Technologies. But when comparing it to its historical volatility, DAX Index is 5.37 times less risky than Digilife Technologies. It trades about 0.14 of its potential returns per unit of risk. Digilife Technologies Limited is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 77.00 in Digilife Technologies Limited on September 1, 2024 and sell it today you would earn a total of 1.00 from holding Digilife Technologies Limited or generate 1.3% 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. Digilife Technologies Limited
Performance |
| Timeline |
DAX Index and Digilife Technologies Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
Digilife Technologies Limited
Pair trading matchups for Digilife Technologies
Pair Trading with DAX Index and Digilife Technologies
The main advantage of trading using opposite DAX Index and Digilife Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, Digilife Technologies 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 Digilife Technologies will offset losses from the drop in Digilife Technologies' long position.| DAX Index vs. BE Semiconductor Industries | DAX Index vs. REGAL ASIAN INVESTMENTS | DAX Index vs. SEI INVESTMENTS | DAX Index vs. National Beverage Corp |
| Digilife Technologies vs. ATT Inc | Digilife Technologies vs. Deutsche Telekom AG | Digilife Technologies vs. Superior Plus Corp | Digilife Technologies vs. NMI Holdings |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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