Correlation Between Xtrackers and Xtrackers
Can any of the company-specific risk be diversified away by investing in both Xtrackers and Xtrackers 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 Xtrackers into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xtrackers II and Xtrackers SP, you can compare the effects of market volatilities on Xtrackers and Xtrackers 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 Xtrackers. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xtrackers and Xtrackers.
Diversification Opportunities for Xtrackers and Xtrackers
Very good diversification
The 3 months correlation between Xtrackers and Xtrackers is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Xtrackers II and Xtrackers SP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xtrackers SP 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 Xtrackers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xtrackers SP has no effect on the direction of Xtrackers i.e., Xtrackers and Xtrackers go up and down completely randomly.
Pair Corralation between Xtrackers and Xtrackers
Assuming the 90 days trading horizon Xtrackers II is expected to under-perform the Xtrackers. In addition to that, Xtrackers is 1.13 times more volatile than Xtrackers SP. It trades about -0.06 of its total potential returns per unit of risk. Xtrackers SP is currently generating about -0.02 per unit of volatility. If you would invest 624.00 in Xtrackers SP on September 12, 2024 and sell it today you would lose (8.00) from holding Xtrackers SP or give up 1.28% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xtrackers II vs. Xtrackers SP
Performance |
| Timeline |
| Xtrackers II |
| Xtrackers SP |
Xtrackers and Xtrackers Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xtrackers and Xtrackers
The main advantage of trading using opposite Xtrackers and Xtrackers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xtrackers position performs unexpectedly, Xtrackers 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 Xtrackers will offset losses from the drop in Xtrackers' long position.| Xtrackers vs. Xtrackers II Global | Xtrackers vs. Xtrackers FTSE | Xtrackers vs. Xtrackers SP 500 | Xtrackers vs. Xtrackers MSCI |
| Xtrackers vs. Xtrackers II Global | Xtrackers vs. Xtrackers FTSE | Xtrackers vs. Xtrackers SP 500 | Xtrackers vs. Xtrackers MSCI |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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