Correlation Between Xtrackers and Amundi Index
Can any of the company-specific risk be diversified away by investing in both Xtrackers and Amundi Index 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 Amundi Index into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xtrackers II and Amundi Index Solutions, you can compare the effects of market volatilities on Xtrackers and Amundi 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 Xtrackers with a short position of Amundi Index. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xtrackers and Amundi Index.
Diversification Opportunities for Xtrackers and Amundi Index
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Xtrackers and Amundi is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Xtrackers II and Amundi Index Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amundi Index Solutions 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 II are associated (or correlated) with Amundi Index. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amundi Index Solutions has no effect on the direction of Xtrackers i.e., Xtrackers and Amundi Index go up and down completely randomly.
Pair Corralation between Xtrackers and Amundi Index
Assuming the 90 days trading horizon Xtrackers is expected to generate 2.09 times less return on investment than Amundi Index. But when comparing it to its historical volatility, Xtrackers II is 1.37 times less risky than Amundi Index. It trades about 0.03 of its potential returns per unit of risk. Amundi Index Solutions is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 483.00 in Amundi Index Solutions on September 3, 2024 and sell it today you would earn a total of 30.00 from holding Amundi Index Solutions or generate 6.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.22% |
| Values | Daily Returns |
Xtrackers II vs. Amundi Index Solutions
Performance |
| Timeline |
| Xtrackers II |
| Amundi Index Solutions |
Xtrackers and Amundi Index Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xtrackers and Amundi Index
The main advantage of trading using opposite Xtrackers and Amundi Index positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xtrackers position performs unexpectedly, Amundi 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 Amundi Index will offset losses from the drop in Amundi Index's long position.| Xtrackers vs. Xtrackers II Global | Xtrackers vs. Xtrackers FTSE | Xtrackers vs. Xtrackers SP 500 | Xtrackers vs. Xtrackers MSCI |
| Amundi Index vs. Amundi MSCI Europe | Amundi Index vs. Amundi SP 500 | Amundi Index vs. Amundi Index Solutions | Amundi Index vs. Amundi Euro Stoxx |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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