Correlation Between DAX Index and PEPKOR
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By analyzing existing cross correlation between DAX Index and PEPKOR LTD, you can compare the effects of market volatilities on DAX Index and PEPKOR 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 DAX Index with a short position of PEPKOR. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and PEPKOR.
Diversification Opportunities for DAX Index and PEPKOR
Very poor diversification
The 3 months correlation between DAX and PEPKOR is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and PEPKOR LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PEPKOR LTD and DAX Index 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 DAX Index are associated (or correlated) with PEPKOR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PEPKOR LTD has no effect on the direction of DAX Index i.e., DAX Index and PEPKOR go up and down completely randomly.
Pair Corralation between DAX Index and PEPKOR
Assuming the 90 days trading horizon DAX Index is expected to generate 6.96 times less return on investment than PEPKOR. But when comparing it to its historical volatility, DAX Index is 2.93 times less risky than PEPKOR. It trades about 0.07 of its potential returns per unit of risk. PEPKOR LTD is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 84.00 in PEPKOR LTD on September 24, 2024 and sell it today you would earn a total of 75.00 from holding PEPKOR LTD or generate 89.29% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
DAX Index vs. PEPKOR LTD
Performance |
Timeline |
DAX Index and PEPKOR Volatility Contrast
Predicted Return Density |
Returns |
DAX Index
Pair trading matchups for DAX Index
PEPKOR LTD
Pair trading matchups for PEPKOR
Pair Trading with DAX Index and PEPKOR
The main advantage of trading using opposite DAX Index and PEPKOR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, PEPKOR 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 PEPKOR will offset losses from the drop in PEPKOR's long position.DAX Index vs. Seven West Media | DAX Index vs. TERADATA | DAX Index vs. DICKER DATA LTD | DAX Index vs. Datang International Power |
PEPKOR vs. Aeon Co | PEPKOR vs. SHOPRITE HDGS ADR | PEPKOR vs. Shoprite Holdings Limited | PEPKOR vs. Dillards |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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