Correlation Between DAX Index and THORNEY TECHS
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By analyzing existing cross correlation between DAX Index and THORNEY TECHS LTD, you can compare the effects of market volatilities on DAX Index and THORNEY TECHS 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 THORNEY TECHS. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and THORNEY TECHS.
Diversification Opportunities for DAX Index and THORNEY TECHS
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between DAX and THORNEY is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and THORNEY TECHS LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on THORNEY TECHS LTD 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 THORNEY TECHS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of THORNEY TECHS LTD has no effect on the direction of DAX Index i.e., DAX Index and THORNEY TECHS go up and down completely randomly.
Pair Corralation between DAX Index and THORNEY TECHS
Assuming the 90 days trading horizon DAX Index is expected to generate 0.31 times more return on investment than THORNEY TECHS. However, DAX Index is 3.23 times less risky than THORNEY TECHS. It trades about 0.14 of its potential returns per unit of risk. THORNEY TECHS LTD is currently generating about -0.06 per unit of risk. If you would invest 1,907,754 in DAX Index on September 1, 2024 and sell it today you would earn a total of 54,891 from holding DAX Index or generate 2.88% 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. THORNEY TECHS LTD
Performance |
| Timeline |
DAX Index and THORNEY TECHS Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
THORNEY TECHS LTD
Pair trading matchups for THORNEY TECHS
Pair Trading with DAX Index and THORNEY TECHS
The main advantage of trading using opposite DAX Index and THORNEY TECHS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, THORNEY TECHS 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 THORNEY TECHS will offset losses from the drop in THORNEY TECHS's long position.| DAX Index vs. BE Semiconductor Industries | DAX Index vs. REGAL ASIAN INVESTMENTS | DAX Index vs. SEI INVESTMENTS | DAX Index vs. National Beverage Corp |
| THORNEY TECHS vs. Apple Inc | THORNEY TECHS vs. Apple Inc | THORNEY TECHS vs. Apple Inc | THORNEY TECHS vs. Apple Inc |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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