Correlation Between Sekisui Chemical and DAX Index
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By analyzing existing cross correlation between Sekisui Chemical Co and DAX Index, you can compare the effects of market volatilities on Sekisui Chemical and DAX Index 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 Sekisui Chemical with a short position of DAX Index. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sekisui Chemical and DAX Index.
Diversification Opportunities for Sekisui Chemical and DAX Index
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Sekisui and DAX is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Sekisui Chemical Co and DAX Index in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DAX Index and Sekisui Chemical 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 Sekisui Chemical Co are associated (or correlated) with DAX Index. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DAX Index has no effect on the direction of Sekisui Chemical i.e., Sekisui Chemical and DAX Index go up and down completely randomly.
Pair Corralation between Sekisui Chemical and DAX Index
Assuming the 90 days horizon Sekisui Chemical is expected to generate 1.24 times less return on investment than DAX Index. In addition to that, Sekisui Chemical is 5.11 times more volatile than DAX Index. It trades about 0.07 of its total potential returns per unit of risk. DAX Index is currently generating about 0.47 per unit of volatility. If you would invest 1,984,877 in DAX Index on October 22, 2024 and sell it today you would earn a total of 105,462 from holding DAX Index or generate 5.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sekisui Chemical Co vs. DAX Index
Performance |
| Timeline |
Sekisui Chemical and DAX Index Volatility Contrast
Predicted Return Density |
| Returns |
Sekisui Chemical Co
Pair trading matchups for Sekisui Chemical
DAX Index
Pair trading matchups for DAX Index
Pair Trading with Sekisui Chemical and DAX Index
The main advantage of trading using opposite Sekisui Chemical and DAX Index positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sekisui Chemical position performs unexpectedly, DAX Index 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 DAX Index will offset losses from the drop in DAX Index's long position.| Sekisui Chemical vs. EEDUCATION ALBERT AB | Sekisui Chemical vs. Telecom Argentina SA | Sekisui Chemical vs. CITIC Telecom International | Sekisui Chemical vs. Chengdu PUTIAN Telecommunications |
| DAX Index vs. SOUTHWEST AIRLINES | DAX Index vs. TOREX SEMICONDUCTOR LTD | DAX Index vs. China Eastern Airlines | DAX Index vs. Aegean Airlines SA |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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