Correlation Between DAX Index and WisdomTree Battery
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By analyzing existing cross correlation between DAX Index and WisdomTree Battery Metals, you can compare the effects of market volatilities on DAX Index and WisdomTree Battery 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 WisdomTree Battery. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and WisdomTree Battery.
Diversification Opportunities for DAX Index and WisdomTree Battery
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between DAX and WisdomTree is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and WisdomTree Battery Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WisdomTree Battery Metals 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 WisdomTree Battery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WisdomTree Battery Metals has no effect on the direction of DAX Index i.e., DAX Index and WisdomTree Battery go up and down completely randomly.
Pair Corralation between DAX Index and WisdomTree Battery
Assuming the 90 days trading horizon DAX Index is expected to generate 0.7 times more return on investment than WisdomTree Battery. However, DAX Index is 1.43 times less risky than WisdomTree Battery. It trades about 0.1 of its potential returns per unit of risk. WisdomTree Battery Metals is currently generating about 0.04 per unit of risk. If you would invest 1,679,443 in DAX Index on September 4, 2024 and sell it today you would earn a total of 322,232 from holding DAX Index or generate 19.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
DAX Index vs. WisdomTree Battery Metals
Performance |
| Timeline |
DAX Index and WisdomTree Battery Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
WisdomTree Battery Metals
Pair trading matchups for WisdomTree Battery
Pair Trading with DAX Index and WisdomTree Battery
The main advantage of trading using opposite DAX Index and WisdomTree Battery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, WisdomTree Battery 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 WisdomTree Battery will offset losses from the drop in WisdomTree Battery's long position.| DAX Index vs. LION ONE METALS | DAX Index vs. KENNAMETAL INC | DAX Index vs. HYATT HOTELS A | DAX Index vs. Zijin Mining Group |
| WisdomTree Battery vs. UBS Fund Solutions | WisdomTree Battery vs. Xtrackers II | WisdomTree Battery vs. Xtrackers Nikkei 225 | WisdomTree Battery vs. iShares VII PLC |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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