Correlation Between DAX Index and BRF SA
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By analyzing existing cross correlation between DAX Index and BRF SA, you can compare the effects of market volatilities on DAX Index and BRF SA 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 BRF SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and BRF SA.
Diversification Opportunities for DAX Index and BRF SA
Very weak diversification
The 3 months correlation between DAX and BRF is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and BRF SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BRF SA 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 BRF SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BRF SA has no effect on the direction of DAX Index i.e., DAX Index and BRF SA go up and down completely randomly.
Pair Corralation between DAX Index and BRF SA
Assuming the 90 days trading horizon DAX Index is expected to generate 0.23 times more return on investment than BRF SA. However, DAX Index is 4.29 times less risky than BRF SA. It trades about -0.03 of its potential returns per unit of risk. BRF SA is currently generating about -0.43 per unit of risk. If you would invest 2,039,916 in DAX Index on October 12, 2024 and sell it today you would lose (8,206) from holding DAX Index or give up 0.4% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 94.44% |
| Values | Daily Returns |
DAX Index vs. BRF SA
Performance |
| Timeline |
DAX Index and BRF SA Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
BRF SA
Pair trading matchups for BRF SA
Pair Trading with DAX Index and BRF SA
The main advantage of trading using opposite DAX Index and BRF SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, BRF SA 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 BRF SA will offset losses from the drop in BRF SA's long position.| DAX Index vs. Eurasia Mining Plc | DAX Index vs. URBAN OUTFITTERS | DAX Index vs. MCEWEN MINING INC | DAX Index vs. ANGLO ASIAN MINING |
| BRF SA vs. Thai Beverage Public | BRF SA vs. National Beverage Corp | BRF SA vs. Austevoll Seafood ASA | BRF SA vs. Apollo Investment Corp |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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