Correlation Between DAX Index and IShares Core
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By analyzing existing cross correlation between DAX Index and iShares Core SP, you can compare the effects of market volatilities on DAX Index and IShares Core 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 IShares Core. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and IShares Core.
Diversification Opportunities for DAX Index and IShares Core
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between DAX and IShares is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and iShares Core SP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Core SP 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 IShares Core. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares Core SP has no effect on the direction of DAX Index i.e., DAX Index and IShares Core go up and down completely randomly.
Pair Corralation between DAX Index and IShares Core
Assuming the 90 days trading horizon DAX Index is expected to generate 1.64 times less return on investment than IShares Core. But when comparing it to its historical volatility, DAX Index is 1.07 times less risky than IShares Core. It trades about 0.08 of its potential returns per unit of risk. iShares Core SP is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 37,712 in iShares Core SP on August 28, 2024 and sell it today you would earn a total of 22,736 from holding iShares Core SP or generate 60.29% 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. iShares Core SP
Performance |
| Timeline |
DAX Index and IShares Core Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
iShares Core SP
Pair trading matchups for IShares Core
Pair Trading with DAX Index and IShares Core
The main advantage of trading using opposite DAX Index and IShares Core positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, IShares Core 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 IShares Core will offset losses from the drop in IShares Core's long position.| DAX Index vs. ELMOS SEMICONDUCTOR | DAX Index vs. ALTAIR RES INC | DAX Index vs. Fair Isaac Corp | DAX Index vs. Taiwan Semiconductor Manufacturing |
| IShares Core vs. iShares Govt Bond | IShares Core vs. iShares Global AAA AA | IShares Core vs. iShares Smart City | IShares Core vs. iShares Broad High |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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