Correlation Between DAX Index and Peabody Energy
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By analyzing existing cross correlation between DAX Index and Peabody Energy, you can compare the effects of market volatilities on DAX Index and Peabody Energy 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 Peabody Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and Peabody Energy.
Diversification Opportunities for DAX Index and Peabody Energy
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between DAX and Peabody is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and Peabody Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Peabody Energy 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 Peabody Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Peabody Energy has no effect on the direction of DAX Index i.e., DAX Index and Peabody Energy go up and down completely randomly.
Pair Corralation between DAX Index and Peabody Energy
Assuming the 90 days trading horizon DAX Index is expected to generate 0.33 times more return on investment than Peabody Energy. However, DAX Index is 3.06 times less risky than Peabody Energy. It trades about 0.1 of its potential returns per unit of risk. Peabody Energy is currently generating about 0.02 per unit of risk. If you would invest 1,679,443 in DAX Index on September 4, 2024 and sell it today you would earn a total of 322,232 from holding DAX Index or generate 19.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
DAX Index vs. Peabody Energy
Performance |
| Timeline |
DAX Index and Peabody Energy Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
Peabody Energy
Pair trading matchups for Peabody Energy
Pair Trading with DAX Index and Peabody Energy
The main advantage of trading using opposite DAX Index and Peabody Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, Peabody Energy 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 Peabody Energy will offset losses from the drop in Peabody Energy's long position.| DAX Index vs. LION ONE METALS | DAX Index vs. KENNAMETAL INC | DAX Index vs. HYATT HOTELS A | DAX Index vs. Zijin Mining Group |
| Peabody Energy vs. PT Bayan Resources | Peabody Energy vs. Yanzhou Coal Mining | Peabody Energy vs. Yanzhou Coal Mining | Peabody Energy vs. PT Adaro Energy |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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