Correlation Between DAX Index and AB SKF
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By analyzing existing cross correlation between DAX Index and AB SKF, you can compare the effects of market volatilities on DAX Index and AB SKF 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 AB SKF. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and AB SKF.
Diversification Opportunities for DAX Index and AB SKF
Poor diversification
The 3 months correlation between DAX and SKFB is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and AB SKF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AB SKF 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 AB SKF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AB SKF has no effect on the direction of DAX Index i.e., DAX Index and AB SKF go up and down completely randomly.
Pair Corralation between DAX Index and AB SKF
Assuming the 90 days trading horizon DAX Index is expected to generate 1.58 times less return on investment than AB SKF. But when comparing it to its historical volatility, DAX Index is 2.64 times less risky than AB SKF. It trades about 0.09 of its potential returns per unit of risk. AB SKF is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 1,704 in AB SKF on September 3, 2024 and sell it today you would earn a total of 107.00 from holding AB SKF or generate 6.28% 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. AB SKF
Performance |
| Timeline |
DAX Index and AB SKF Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
AB SKF
Pair trading matchups for AB SKF
Pair Trading with DAX Index and AB SKF
The main advantage of trading using opposite DAX Index and AB SKF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, AB SKF 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 AB SKF will offset losses from the drop in AB SKF'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 |
| AB SKF vs. Merit Medical Systems | AB SKF vs. Diamyd Medical AB | AB SKF vs. Apollo Medical Holdings | AB SKF vs. Constellation Software |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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