Correlation Between DAX Index and OBSERVE MEDICAL
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By analyzing existing cross correlation between DAX Index and OBSERVE MEDICAL ASA, you can compare the effects of market volatilities on DAX Index and OBSERVE MEDICAL 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 OBSERVE MEDICAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and OBSERVE MEDICAL.
Diversification Opportunities for DAX Index and OBSERVE MEDICAL
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between DAX and OBSERVE is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and OBSERVE MEDICAL ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OBSERVE MEDICAL ASA 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 OBSERVE MEDICAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OBSERVE MEDICAL ASA has no effect on the direction of DAX Index i.e., DAX Index and OBSERVE MEDICAL go up and down completely randomly.
Pair Corralation between DAX Index and OBSERVE MEDICAL
Assuming the 90 days trading horizon DAX Index is expected to generate 0.17 times more return on investment than OBSERVE MEDICAL. However, DAX Index is 6.05 times less risky than OBSERVE MEDICAL. It trades about 0.21 of its potential returns per unit of risk. OBSERVE MEDICAL ASA is currently generating about -0.01 per unit of risk. If you would invest 1,929,598 in DAX Index on September 27, 2024 and sell it today you would earn a total of 55,279 from holding DAX Index or generate 2.86% 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. OBSERVE MEDICAL ASA
Performance |
| Timeline |
DAX Index and OBSERVE MEDICAL Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
OBSERVE MEDICAL ASA
Pair trading matchups for OBSERVE MEDICAL
Pair Trading with DAX Index and OBSERVE MEDICAL
The main advantage of trading using opposite DAX Index and OBSERVE MEDICAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, OBSERVE MEDICAL 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 OBSERVE MEDICAL will offset losses from the drop in OBSERVE MEDICAL's long position.| DAX Index vs. URBAN OUTFITTERS | DAX Index vs. DATANG INTL POW | DAX Index vs. Magnachip Semiconductor | DAX Index vs. Datang International Power |
| OBSERVE MEDICAL vs. Corporate Travel Management | OBSERVE MEDICAL vs. DETALION GAMES SA | OBSERVE MEDICAL vs. Cleanaway Waste Management | OBSERVE MEDICAL vs. Games Workshop 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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