Correlation Between DAX Index and Total Gabon
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By analyzing existing cross correlation between DAX Index and Total Gabon, you can compare the effects of market volatilities on DAX Index and Total Gabon 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 Total Gabon. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and Total Gabon.
Diversification Opportunities for DAX Index and Total Gabon
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between DAX and Total is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and Total Gabon in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Total Gabon 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 Total Gabon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Total Gabon has no effect on the direction of DAX Index i.e., DAX Index and Total Gabon go up and down completely randomly.
Pair Corralation between DAX Index and Total Gabon
Assuming the 90 days trading horizon DAX Index is expected to generate 2.52 times less return on investment than Total Gabon. But when comparing it to its historical volatility, DAX Index is 4.65 times less risky than Total Gabon. It trades about 0.5 of its potential returns per unit of risk. Total Gabon is currently generating about 0.27 of returns per unit of risk over similar time horizon. If you would invest 15,650 in Total Gabon on September 13, 2024 and sell it today you would earn a total of 2,900 from holding Total Gabon or generate 18.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
DAX Index vs. Total Gabon
Performance |
| Timeline |
DAX Index and Total Gabon Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
Total Gabon
Pair trading matchups for Total Gabon
Pair Trading with DAX Index and Total Gabon
The main advantage of trading using opposite DAX Index and Total Gabon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, Total Gabon 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 Total Gabon will offset losses from the drop in Total Gabon's long position.| DAX Index vs. CARSALESCOM | DAX Index vs. Sumitomo Mitsui Construction | DAX Index vs. H FARM SPA | DAX Index vs. Nufarm Limited |
| Total Gabon vs. Lery Seafood Group | Total Gabon vs. ARDAGH METAL PACDL 0001 | Total Gabon vs. FIREWEED METALS P | Total Gabon vs. CN MODERN DAIRY |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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