Correlation Between DAX Index and Stanley Electric
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By analyzing existing cross correlation between DAX Index and Stanley Electric Co, you can compare the effects of market volatilities on DAX Index and Stanley Electric 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 Stanley Electric. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and Stanley Electric.
Diversification Opportunities for DAX Index and Stanley Electric
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between DAX and Stanley is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and Stanley Electric Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stanley Electric 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 Stanley Electric. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stanley Electric has no effect on the direction of DAX Index i.e., DAX Index and Stanley Electric go up and down completely randomly.
Pair Corralation between DAX Index and Stanley Electric
Assuming the 90 days trading horizon DAX Index is expected to generate 0.39 times more return on investment than Stanley Electric. However, DAX Index is 2.56 times less risky than Stanley Electric. It trades about 0.15 of its potential returns per unit of risk. Stanley Electric Co is currently generating about 0.02 per unit of risk. If you would invest 1,489,218 in DAX Index on September 19, 2024 and sell it today you would earn a total of 535,039 from holding DAX Index or generate 35.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
DAX Index vs. Stanley Electric Co
Performance |
| Timeline |
DAX Index and Stanley Electric Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
Stanley Electric Co
Pair trading matchups for Stanley Electric
Pair Trading with DAX Index and Stanley Electric
The main advantage of trading using opposite DAX Index and Stanley Electric positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, Stanley Electric 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 Stanley Electric will offset losses from the drop in Stanley Electric's long position.| DAX Index vs. Warner Music Group | DAX Index vs. Take Two Interactive Software | DAX Index vs. Sixt Leasing SE | DAX Index vs. JAPAN TOBACCO UNSPADR12 |
| Stanley Electric vs. MGIC INVESTMENT | Stanley Electric vs. JAPAN AIRLINES | Stanley Electric vs. WisdomTree Investments | Stanley Electric vs. Nok Airlines PCL |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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