Correlation Between DAX Index and Teck Resources
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By analyzing existing cross correlation between DAX Index and Teck Resources Ltd, you can compare the effects of market volatilities on DAX Index and Teck Resources 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 Teck Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and Teck Resources.
Diversification Opportunities for DAX Index and Teck Resources
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between DAX and Teck is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and Teck Resources Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Teck Resources 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 Teck Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Teck Resources has no effect on the direction of DAX Index i.e., DAX Index and Teck Resources go up and down completely randomly.
Pair Corralation between DAX Index and Teck Resources
Assuming the 90 days trading horizon DAX Index is expected to generate 1.38 times less return on investment than Teck Resources. But when comparing it to its historical volatility, DAX Index is 3.18 times less risky than Teck Resources. It trades about 0.08 of its potential returns per unit of risk. Teck Resources Ltd is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 3,301 in Teck Resources Ltd on September 2, 2024 and sell it today you would earn a total of 1,131 from holding Teck Resources Ltd or generate 34.26% 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. Teck Resources Ltd
Performance |
| Timeline |
DAX Index and Teck Resources Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
Teck Resources Ltd
Pair trading matchups for Teck Resources
Pair Trading with DAX Index and Teck Resources
The main advantage of trading using opposite DAX Index and Teck Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, Teck Resources 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 Teck Resources will offset losses from the drop in Teck Resources' long position.| DAX Index vs. FEMALE HEALTH | DAX Index vs. CDN IMPERIAL BANK | DAX Index vs. Webster Financial | DAX Index vs. Cardinal Health |
| Teck Resources vs. BHP Group Limited | Teck Resources vs. Rio Tinto Group | Teck Resources vs. Vale SA | Teck Resources vs. Vale SA |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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