Correlation Between DAX Index and Nasdaq
Specify exactly 2 symbols:
By analyzing existing cross correlation between DAX Index and Nasdaq Inc, you can compare the effects of market volatilities on DAX Index and Nasdaq 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 Nasdaq. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and Nasdaq.
Diversification Opportunities for DAX Index and Nasdaq
Very weak diversification
The 3 months correlation between DAX and Nasdaq is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and Nasdaq Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nasdaq Inc 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 Nasdaq. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nasdaq Inc has no effect on the direction of DAX Index i.e., DAX Index and Nasdaq go up and down completely randomly.
Pair Corralation between DAX Index and Nasdaq
Assuming the 90 days trading horizon DAX Index is expected to generate 1.19 times less return on investment than Nasdaq. But when comparing it to its historical volatility, DAX Index is 1.78 times less risky than Nasdaq. It trades about 0.09 of its potential returns per unit of risk. Nasdaq Inc is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 5,365 in Nasdaq Inc on November 2, 2024 and sell it today you would earn a total of 2,485 from holding Nasdaq Inc or generate 46.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
DAX Index vs. Nasdaq Inc
Performance |
| Timeline |
DAX Index and Nasdaq Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
Nasdaq Inc
Pair trading matchups for Nasdaq
Pair Trading with DAX Index and Nasdaq
The main advantage of trading using opposite DAX Index and Nasdaq positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, Nasdaq 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 Nasdaq will offset losses from the drop in Nasdaq's long position.| DAX Index vs. ANTA SPORTS PRODUCT | DAX Index vs. SCIENCE IN SPORT | DAX Index vs. Columbia Sportswear | DAX Index vs. Pebblebrook Hotel Trust |
| Nasdaq vs. Sumitomo Mitsui Construction | Nasdaq vs. Hyatt Hotels | Nasdaq vs. China Railway Construction | Nasdaq vs. Pebblebrook Hotel Trust |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
Other Complementary Tools
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities |