Correlation Between DAX Index and TFS FINANCIAL
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By analyzing existing cross correlation between DAX Index and TFS FINANCIAL, you can compare the effects of market volatilities on DAX Index and TFS FINANCIAL 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 TFS FINANCIAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and TFS FINANCIAL.
Diversification Opportunities for DAX Index and TFS FINANCIAL
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between DAX and TFS is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and TFS FINANCIAL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TFS FINANCIAL 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 TFS FINANCIAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TFS FINANCIAL has no effect on the direction of DAX Index i.e., DAX Index and TFS FINANCIAL go up and down completely randomly.
Pair Corralation between DAX Index and TFS FINANCIAL
Assuming the 90 days trading horizon DAX Index is expected to under-perform the TFS FINANCIAL. But the index apears to be less risky and, when comparing its historical volatility, DAX Index is 2.83 times less risky than TFS FINANCIAL. The index trades about -0.05 of its potential returns per unit of risk. The TFS FINANCIAL is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 1,200 in TFS FINANCIAL on August 30, 2024 and sell it today you would earn a total of 150.00 from holding TFS FINANCIAL or generate 12.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
DAX Index vs. TFS FINANCIAL
Performance |
| Timeline |
DAX Index and TFS FINANCIAL Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
TFS FINANCIAL
Pair trading matchups for TFS FINANCIAL
Pair Trading with DAX Index and TFS FINANCIAL
The main advantage of trading using opposite DAX Index and TFS FINANCIAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, TFS FINANCIAL 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 TFS FINANCIAL will offset losses from the drop in TFS FINANCIAL's long position.| DAX Index vs. NEWELL RUBBERMAID | DAX Index vs. APPLIED MATERIALS | DAX Index vs. Compagnie Plastic Omnium | DAX Index vs. Vulcan Materials |
| TFS FINANCIAL vs. Apple Inc | TFS FINANCIAL vs. Apple Inc | TFS FINANCIAL vs. Superior Plus Corp | TFS FINANCIAL vs. SIVERS SEMICONDUCTORS AB |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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