Correlation Between DAX Index and SIMCERE PHARMAC
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By analyzing existing cross correlation between DAX Index and SIMCERE PHARMAC GRP, you can compare the effects of market volatilities on DAX Index and SIMCERE PHARMAC 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 SIMCERE PHARMAC. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and SIMCERE PHARMAC.
Diversification Opportunities for DAX Index and SIMCERE PHARMAC
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between DAX and SIMCERE is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and SIMCERE PHARMAC GRP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SIMCERE PHARMAC GRP 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 SIMCERE PHARMAC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SIMCERE PHARMAC GRP has no effect on the direction of DAX Index i.e., DAX Index and SIMCERE PHARMAC go up and down completely randomly.
Pair Corralation between DAX Index and SIMCERE PHARMAC
Assuming the 90 days trading horizon DAX Index is expected to generate 2.35 times less return on investment than SIMCERE PHARMAC. But when comparing it to its historical volatility, DAX Index is 3.7 times less risky than SIMCERE PHARMAC. It trades about 0.13 of its potential returns per unit of risk. SIMCERE PHARMAC GRP is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 80.00 in SIMCERE PHARMAC GRP on September 3, 2024 and sell it today you would earn a total of 4.00 from holding SIMCERE PHARMAC GRP or generate 5.0% 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. SIMCERE PHARMAC GRP
Performance |
| Timeline |
DAX Index and SIMCERE PHARMAC Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
SIMCERE PHARMAC GRP
Pair trading matchups for SIMCERE PHARMAC
Pair Trading with DAX Index and SIMCERE PHARMAC
The main advantage of trading using opposite DAX Index and SIMCERE PHARMAC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, SIMCERE PHARMAC 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 SIMCERE PHARMAC will offset losses from the drop in SIMCERE PHARMAC's long position.| DAX Index vs. SPORT LISBOA E | DAX Index vs. FUYO GENERAL LEASE | DAX Index vs. Live Nation Entertainment | DAX Index vs. Transport International Holdings |
| SIMCERE PHARMAC vs. Merck KGaA | SIMCERE PHARMAC vs. CanSino Biologics | SIMCERE PHARMAC vs. Superior Plus Corp | SIMCERE PHARMAC vs. NMI Holdings |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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