Correlation Between DAX Index and SPDR ICE
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By analyzing existing cross correlation between DAX Index and SPDR ICE BofA, you can compare the effects of market volatilities on DAX Index and SPDR ICE 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 SPDR ICE. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and SPDR ICE.
Diversification Opportunities for DAX Index and SPDR ICE
Average diversification
The 3 months correlation between DAX and SPDR is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and SPDR ICE BofA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPDR ICE BofA 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 SPDR ICE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPDR ICE BofA has no effect on the direction of DAX Index i.e., DAX Index and SPDR ICE go up and down completely randomly.
Pair Corralation between DAX Index and SPDR ICE
Assuming the 90 days trading horizon DAX Index is expected to generate 5.15 times more return on investment than SPDR ICE. However, DAX Index is 5.15 times more volatile than SPDR ICE BofA. It trades about 0.14 of its potential returns per unit of risk. SPDR ICE BofA is currently generating about 0.08 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 | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
DAX Index vs. SPDR ICE BofA
Performance |
| Timeline |
DAX Index and SPDR ICE Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
SPDR ICE BofA
Pair trading matchups for SPDR ICE
Pair Trading with DAX Index and SPDR ICE
The main advantage of trading using opposite DAX Index and SPDR ICE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, SPDR ICE 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 SPDR ICE will offset losses from the drop in SPDR ICE'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 |
| SPDR ICE vs. SPDR Barclays 10 | SPDR ICE vs. SPDR ICE BofA | SPDR ICE vs. SPDR SP Utilities | SPDR ICE vs. SPDR Barclays 3 5 |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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