Correlation Between DAX Index and NOV
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By analyzing existing cross correlation between DAX Index and NOV Inc, you can compare the effects of market volatilities on DAX Index and NOV 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 NOV. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and NOV.
Diversification Opportunities for DAX Index and NOV
Very good diversification
The 3 months correlation between DAX and NOV is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and NOV Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NOV 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 NOV. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NOV Inc has no effect on the direction of DAX Index i.e., DAX Index and NOV go up and down completely randomly.
Pair Corralation between DAX Index and NOV
Assuming the 90 days trading horizon DAX Index is expected to generate 0.33 times more return on investment than NOV. However, DAX Index is 3.05 times less risky than NOV. It trades about 0.08 of its potential returns per unit of risk. NOV Inc is currently generating about -0.02 per unit of risk. If you would invest 1,675,164 in DAX Index on August 25, 2024 and sell it today you would earn a total of 257,095 from holding DAX Index or generate 15.35% 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. NOV Inc
Performance |
| Timeline |
DAX Index and NOV Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
NOV Inc
Pair trading matchups for NOV
Pair Trading with DAX Index and NOV
The main advantage of trading using opposite DAX Index and NOV positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, NOV 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 NOV will offset losses from the drop in NOV's long position.| DAX Index vs. Granite Construction | DAX Index vs. AGRICULTBK HADR25 YC | DAX Index vs. ADRIATIC METALS LS 013355 | DAX Index vs. GREENX METALS LTD |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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