Correlation Between Xtrackers and DBX ETF
Can any of the company-specific risk be diversified away by investing in both Xtrackers and DBX ETF 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 Xtrackers and DBX ETF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xtrackers SP 500 and DBX ETF Trust, you can compare the effects of market volatilities on Xtrackers and DBX ETF 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 Xtrackers with a short position of DBX ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xtrackers and DBX ETF.
Diversification Opportunities for Xtrackers and DBX ETF
Almost no diversification
The 3 months correlation between Xtrackers and DBX is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Xtrackers SP 500 and DBX ETF Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DBX ETF Trust and Xtrackers 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 Xtrackers SP 500 are associated (or correlated) with DBX ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DBX ETF Trust has no effect on the direction of Xtrackers i.e., Xtrackers and DBX ETF go up and down completely randomly.
Pair Corralation between Xtrackers and DBX ETF
Given the investment horizon of 90 days Xtrackers SP 500 is expected to generate 0.79 times more return on investment than DBX ETF. However, Xtrackers SP 500 is 1.27 times less risky than DBX ETF. It trades about 0.14 of its potential returns per unit of risk. DBX ETF Trust is currently generating about 0.1 per unit of risk. If you would invest 4,163 in Xtrackers SP 500 on August 27, 2024 and sell it today you would earn a total of 1,289 from holding Xtrackers SP 500 or generate 30.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xtrackers SP 500 vs. DBX ETF Trust
Performance |
| Timeline |
| Xtrackers SP 500 |
| DBX ETF Trust |
Xtrackers and DBX ETF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xtrackers and DBX ETF
The main advantage of trading using opposite Xtrackers and DBX ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xtrackers position performs unexpectedly, DBX ETF 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 DBX ETF will offset losses from the drop in DBX ETF's long position.| Xtrackers vs. Morningstar Unconstrained Allocation | Xtrackers vs. High Yield Municipal Fund | Xtrackers vs. Via Renewables | Xtrackers vs. Knife River |
| DBX ETF vs. Vanguard Mid Cap Index | DBX ETF vs. Vanguard Extended Market | DBX ETF vs. iShares Core SP | DBX ETF vs. SPDR SP MIDCAP |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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