Correlation Between United States and DAX Index
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By analyzing existing cross correlation between United States Steel and DAX Index, you can compare the effects of market volatilities on United States 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 United States with a short position of DAX Index. Check out your portfolio center. Please also check ongoing floating volatility patterns of United States and DAX Index.
Diversification Opportunities for United States and DAX Index
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between United and DAX is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding United States Steel and DAX Index in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DAX Index and United States 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 United States Steel 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 United States i.e., United States and DAX Index go up and down completely randomly.
Pair Corralation between United States and DAX Index
Assuming the 90 days trading horizon United States Steel is expected to generate 5.8 times more return on investment than DAX Index. However, United States is 5.8 times more volatile than DAX Index. It trades about 0.26 of its potential returns per unit of risk. DAX Index is currently generating about 0.53 per unit of risk. If you would invest 2,979 in United States Steel on October 30, 2024 and sell it today you would earn a total of 575.00 from holding United States Steel or generate 19.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
United States Steel vs. DAX Index
Performance |
| Timeline |
United States and DAX Index Volatility Contrast
Predicted Return Density |
| Returns |
United States Steel
Pair trading matchups for United States
DAX Index
Pair trading matchups for DAX Index
Pair Trading with United States and DAX Index
The main advantage of trading using opposite United States and DAX Index positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United States 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.| United States vs. AWILCO DRILLING PLC | United States vs. ELL ENVIRONHLDGS HD 0001 | United States vs. Olympic Steel | United States vs. COSMOSTEEL HLDGS |
| DAX Index vs. Ribbon Communications | DAX Index vs. Highlight Communications AG | DAX Index vs. Cairo Communication SpA | DAX Index vs. Spirent Communications 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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