Correlation Between Nasdaq 100 and Dws Emerging
Can any of the company-specific risk be diversified away by investing in both Nasdaq 100 and Dws Emerging at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Nasdaq 100 and Dws Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nasdaq 100 2x Strategy and Dws Emerging Markets, you can compare the effects of market volatilities on Nasdaq 100 and Dws Emerging 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 Nasdaq 100 with a short position of Dws Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nasdaq 100 and Dws Emerging.
Diversification Opportunities for Nasdaq 100 and Dws Emerging
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Nasdaq and Dws is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Nasdaq 100 2x Strategy and Dws Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dws Emerging Markets and Nasdaq 100 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 Nasdaq 100 2x Strategy are associated (or correlated) with Dws Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dws Emerging Markets has no effect on the direction of Nasdaq 100 i.e., Nasdaq 100 and Dws Emerging go up and down completely randomly.
Pair Corralation between Nasdaq 100 and Dws Emerging
Assuming the 90 days horizon Nasdaq 100 2x Strategy is expected to generate 2.43 times more return on investment than Dws Emerging. However, Nasdaq 100 is 2.43 times more volatile than Dws Emerging Markets. It trades about 0.06 of its potential returns per unit of risk. Dws Emerging Markets is currently generating about 0.05 per unit of risk. If you would invest 33,116 in Nasdaq 100 2x Strategy on August 23, 2024 and sell it today you would earn a total of 7,942 from holding Nasdaq 100 2x Strategy or generate 23.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nasdaq 100 2x Strategy vs. Dws Emerging Markets
Performance |
| Timeline |
| Nasdaq 100 2x |
| Dws Emerging Markets |
Nasdaq 100 and Dws Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nasdaq 100 and Dws Emerging
The main advantage of trading using opposite Nasdaq 100 and Dws Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nasdaq 100 position performs unexpectedly, Dws Emerging 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 Dws Emerging will offset losses from the drop in Dws Emerging's long position.| Nasdaq 100 vs. Shelton Emerging Markets | Nasdaq 100 vs. Pace International Emerging | Nasdaq 100 vs. Ep Emerging Markets | Nasdaq 100 vs. Artisan Emerging Markets |
| Dws Emerging vs. Vanguard Emerging Markets | Dws Emerging vs. Vanguard Emerging Markets | Dws Emerging vs. Vanguard Emerging Markets | Dws Emerging vs. HUMANA 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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