Correlation Between DAX Index and CBRE GROUP
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By analyzing existing cross correlation between DAX Index and CBRE GROUP A, you can compare the effects of market volatilities on DAX Index and CBRE GROUP 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 CBRE GROUP. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and CBRE GROUP.
Diversification Opportunities for DAX Index and CBRE GROUP
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between DAX and CBRE is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and CBRE GROUP A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CBRE GROUP A 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 CBRE GROUP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CBRE GROUP A has no effect on the direction of DAX Index i.e., DAX Index and CBRE GROUP go up and down completely randomly.
Pair Corralation between DAX Index and CBRE GROUP
Assuming the 90 days trading horizon DAX Index is expected to generate 2.33 times less return on investment than CBRE GROUP. But when comparing it to its historical volatility, DAX Index is 2.29 times less risky than CBRE GROUP. It trades about 0.09 of its potential returns per unit of risk. CBRE GROUP A is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 7,888 in CBRE GROUP A on September 12, 2024 and sell it today you would earn a total of 5,112 from holding CBRE GROUP A or generate 64.81% 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. CBRE GROUP A
Performance |
| Timeline |
DAX Index and CBRE GROUP Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
CBRE GROUP A
Pair trading matchups for CBRE GROUP
Pair Trading with DAX Index and CBRE GROUP
The main advantage of trading using opposite DAX Index and CBRE GROUP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, CBRE GROUP 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 CBRE GROUP will offset losses from the drop in CBRE GROUP's long position.| DAX Index vs. Arrow Electronics | DAX Index vs. CANON MARKETING JP | DAX Index vs. The Trade Desk | DAX Index vs. METHODE ELECTRONICS |
| CBRE GROUP vs. Entravision Communications | CBRE GROUP vs. Perdoceo Education | CBRE GROUP vs. Zoom Video Communications | CBRE GROUP vs. DEVRY EDUCATION GRP |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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