Correlation Between DAX Index and Pick N
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By analyzing existing cross correlation between DAX Index and Pick n Pay, you can compare the effects of market volatilities on DAX Index and Pick N 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 Pick N. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and Pick N.
Diversification Opportunities for DAX Index and Pick N
Poor diversification
The 3 months correlation between DAX and Pick is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and Pick n Pay in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pick n Pay 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 Pick N. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pick n Pay has no effect on the direction of DAX Index i.e., DAX Index and Pick N go up and down completely randomly.
Pair Corralation between DAX Index and Pick N
Assuming the 90 days trading horizon DAX Index is expected to generate 3.15 times less return on investment than Pick N. But when comparing it to its historical volatility, DAX Index is 5.27 times less risky than Pick N. It trades about 0.1 of its potential returns per unit of risk. Pick n Pay is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 107.00 in Pick n Pay on September 3, 2024 and sell it today you would earn a total of 48.00 from holding Pick n Pay or generate 44.86% 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. Pick n Pay
Performance |
| Timeline |
DAX Index and Pick N Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
Pick n Pay
Pair trading matchups for Pick N
Pair Trading with DAX Index and Pick N
The main advantage of trading using opposite DAX Index and Pick N positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, Pick N 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 Pick N will offset losses from the drop in Pick N's long position.| DAX Index vs. SPORT LISBOA E | DAX Index vs. FUYO GENERAL LEASE | DAX Index vs. Live Nation Entertainment | DAX Index vs. Transport International Holdings |
| Pick N vs. AIR PRODCHEMICALS | Pick N vs. ELECTRONIC ARTS | Pick N vs. Meiko Electronics Co | Pick N vs. Methode Electronics |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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