Correlation Between DAX Index and Tanaka CoLtd
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By analyzing existing cross correlation between DAX Index and Tanaka CoLtd, you can compare the effects of market volatilities on DAX Index and Tanaka CoLtd 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 Tanaka CoLtd. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and Tanaka CoLtd.
Diversification Opportunities for DAX Index and Tanaka CoLtd
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between DAX and Tanaka is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and Tanaka CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tanaka CoLtd 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 Tanaka CoLtd. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tanaka CoLtd has no effect on the direction of DAX Index i.e., DAX Index and Tanaka CoLtd go up and down completely randomly.
Pair Corralation between DAX Index and Tanaka CoLtd
Assuming the 90 days trading horizon DAX Index is expected to generate 0.39 times more return on investment than Tanaka CoLtd. However, DAX Index is 2.55 times less risky than Tanaka CoLtd. It trades about 0.07 of its potential returns per unit of risk. Tanaka CoLtd is currently generating about -0.03 per unit of risk. If you would invest 1,857,594 in DAX Index on September 3, 2024 and sell it today you would earn a total of 135,768 from holding DAX Index or generate 7.31% 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. Tanaka CoLtd
Performance |
| Timeline |
DAX Index and Tanaka CoLtd Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
Tanaka CoLtd
Pair trading matchups for Tanaka CoLtd
Pair Trading with DAX Index and Tanaka CoLtd
The main advantage of trading using opposite DAX Index and Tanaka CoLtd positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, Tanaka CoLtd 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 Tanaka CoLtd will offset losses from the drop in Tanaka CoLtd'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 |
| Tanaka CoLtd vs. Southwest Airlines Co | Tanaka CoLtd vs. WESTLAKE CHEMICAL | Tanaka CoLtd vs. Siamgas And Petrochemicals | Tanaka CoLtd vs. SINGAPORE AIRLINES |
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 Channel module to use Commodity Channel Index to analyze current equity momentum.
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