Correlation Between Xtrackers LevDAX and HANetf ICAV
Can any of the company-specific risk be diversified away by investing in both Xtrackers LevDAX and HANetf ICAV 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 LevDAX and HANetf ICAV into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xtrackers LevDAX and HANetf ICAV , you can compare the effects of market volatilities on Xtrackers LevDAX and HANetf ICAV 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 LevDAX with a short position of HANetf ICAV. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xtrackers LevDAX and HANetf ICAV.
Diversification Opportunities for Xtrackers LevDAX and HANetf ICAV
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Xtrackers and HANetf is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Xtrackers LevDAX and HANetf ICAV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HANetf ICAV and Xtrackers LevDAX 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 LevDAX are associated (or correlated) with HANetf ICAV. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HANetf ICAV has no effect on the direction of Xtrackers LevDAX i.e., Xtrackers LevDAX and HANetf ICAV go up and down completely randomly.
Pair Corralation between Xtrackers LevDAX and HANetf ICAV
Assuming the 90 days trading horizon Xtrackers LevDAX is expected to generate 1.21 times more return on investment than HANetf ICAV. However, Xtrackers LevDAX is 1.21 times more volatile than HANetf ICAV . It trades about 0.18 of its potential returns per unit of risk. HANetf ICAV is currently generating about 0.14 per unit of risk. If you would invest 18,422 in Xtrackers LevDAX on September 25, 2024 and sell it today you would earn a total of 1,524 from holding Xtrackers LevDAX or generate 8.27% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 95.45% |
Values | Daily Returns |
Xtrackers LevDAX vs. HANetf ICAV
Performance |
Timeline |
Xtrackers LevDAX |
HANetf ICAV |
Xtrackers LevDAX and HANetf ICAV Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Xtrackers LevDAX and HANetf ICAV
The main advantage of trading using opposite Xtrackers LevDAX and HANetf ICAV positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xtrackers LevDAX position performs unexpectedly, HANetf ICAV 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 HANetf ICAV will offset losses from the drop in HANetf ICAV's long position.Xtrackers LevDAX vs. Xtrackers II Global | Xtrackers LevDAX vs. Xtrackers FTSE | Xtrackers LevDAX vs. Xtrackers SP 500 | Xtrackers LevDAX vs. Xtrackers MSCI |
HANetf ICAV vs. UBS Fund Solutions | HANetf ICAV vs. Xtrackers II | HANetf ICAV vs. Xtrackers Nikkei 225 | HANetf ICAV vs. iShares VII 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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