Correlation Between DAX Index and Synovus Financial
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By analyzing existing cross correlation between DAX Index and Synovus Financial Corp, you can compare the effects of market volatilities on DAX Index and Synovus Financial 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 Synovus Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and Synovus Financial.
Diversification Opportunities for DAX Index and Synovus Financial
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between DAX and Synovus is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and Synovus Financial Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Synovus Financial Corp 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 Synovus Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Synovus Financial Corp has no effect on the direction of DAX Index i.e., DAX Index and Synovus Financial go up and down completely randomly.
Pair Corralation between DAX Index and Synovus Financial
Assuming the 90 days trading horizon DAX Index is expected to generate 4.68 times less return on investment than Synovus Financial. But when comparing it to its historical volatility, DAX Index is 3.25 times less risky than Synovus Financial. It trades about 0.07 of its potential returns per unit of risk. Synovus Financial Corp is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 2,405 in Synovus Financial Corp on August 30, 2024 and sell it today you would earn a total of 3,045 from holding Synovus Financial Corp or generate 126.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
DAX Index vs. Synovus Financial Corp
Performance |
| Timeline |
DAX Index and Synovus Financial Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
Synovus Financial Corp
Pair trading matchups for Synovus Financial
Pair Trading with DAX Index and Synovus Financial
The main advantage of trading using opposite DAX Index and Synovus Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, Synovus Financial 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 Synovus Financial will offset losses from the drop in Synovus Financial's long position.| DAX Index vs. Gladstone Investment | DAX Index vs. REINET INVESTMENTS SCA | DAX Index vs. CarsalesCom | DAX Index vs. MARKET VECTR RETAIL |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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