Correlation Between DAX Index and RCI Hospitality
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By analyzing existing cross correlation between DAX Index and RCI Hospitality Holdings, you can compare the effects of market volatilities on DAX Index and RCI Hospitality 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 RCI Hospitality. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and RCI Hospitality.
Diversification Opportunities for DAX Index and RCI Hospitality
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between DAX and RCI is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and RCI Hospitality Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RCI Hospitality Holdings 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 RCI Hospitality. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RCI Hospitality Holdings has no effect on the direction of DAX Index i.e., DAX Index and RCI Hospitality go up and down completely randomly.
Pair Corralation between DAX Index and RCI Hospitality
Assuming the 90 days trading horizon DAX Index is expected to generate 0.4 times more return on investment than RCI Hospitality. However, DAX Index is 2.51 times less risky than RCI Hospitality. It trades about 0.66 of its potential returns per unit of risk. RCI Hospitality Holdings is currently generating about -0.07 per unit of risk. If you would invest 1,990,608 in DAX Index on November 4, 2024 and sell it today you would earn a total of 182,597 from holding DAX Index or generate 9.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
DAX Index vs. RCI Hospitality Holdings
Performance |
| Timeline |
DAX Index and RCI Hospitality Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
RCI Hospitality Holdings
Pair trading matchups for RCI Hospitality
Pair Trading with DAX Index and RCI Hospitality
The main advantage of trading using opposite DAX Index and RCI Hospitality positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, RCI Hospitality 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 RCI Hospitality will offset losses from the drop in RCI Hospitality's long position.| DAX Index vs. SOEDER SPORTFISKE AB | DAX Index vs. Zoom Video Communications | DAX Index vs. Yuexiu Transport Infrastructure | DAX Index vs. Ribbon Communications |
| RCI Hospitality vs. SIERRA METALS | RCI Hospitality vs. Urban Outfitters | RCI Hospitality vs. Jacquet Metal Service | RCI Hospitality vs. AEON METALS LTD |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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