Correlation Between DAX Index and RENTOKIL INITIAL
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By analyzing existing cross correlation between DAX Index and RENTOKIL INITIAL ADR5, you can compare the effects of market volatilities on DAX Index and RENTOKIL INITIAL 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 RENTOKIL INITIAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and RENTOKIL INITIAL.
Diversification Opportunities for DAX Index and RENTOKIL INITIAL
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between DAX and RENTOKIL is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and RENTOKIL INITIAL ADR5 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RENTOKIL INITIAL ADR5 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 RENTOKIL INITIAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RENTOKIL INITIAL ADR5 has no effect on the direction of DAX Index i.e., DAX Index and RENTOKIL INITIAL go up and down completely randomly.
Pair Corralation between DAX Index and RENTOKIL INITIAL
Assuming the 90 days trading horizon DAX Index is expected to generate 0.35 times more return on investment than RENTOKIL INITIAL. However, DAX Index is 2.88 times less risky than RENTOKIL INITIAL. It trades about 0.21 of its potential returns per unit of risk. RENTOKIL INITIAL ADR5 is currently generating about -0.03 per unit of risk. If you would invest 1,932,259 in DAX Index on September 23, 2024 and sell it today you would earn a total of 56,216 from holding DAX Index or generate 2.91% 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. RENTOKIL INITIAL ADR5
Performance |
| Timeline |
DAX Index and RENTOKIL INITIAL Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
RENTOKIL INITIAL ADR5
Pair trading matchups for RENTOKIL INITIAL
Pair Trading with DAX Index and RENTOKIL INITIAL
The main advantage of trading using opposite DAX Index and RENTOKIL INITIAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, RENTOKIL INITIAL 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 RENTOKIL INITIAL will offset losses from the drop in RENTOKIL INITIAL's long position.| DAX Index vs. alstria office REIT AG | DAX Index vs. OFFICE DEPOT | DAX Index vs. CHINA EDUCATION GROUP | DAX Index vs. MAVEN WIRELESS SWEDEN |
| RENTOKIL INITIAL vs. Cintas | RENTOKIL INITIAL vs. INPOST SA EO | RENTOKIL INITIAL vs. Elis SA | RENTOKIL INITIAL vs. PARK24 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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