Correlation Between DAX Index and WOOLWORTHS HLDGS
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By analyzing existing cross correlation between DAX Index and WOOLWORTHS HLDGS, you can compare the effects of market volatilities on DAX Index and WOOLWORTHS HLDGS 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 WOOLWORTHS HLDGS. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and WOOLWORTHS HLDGS.
Diversification Opportunities for DAX Index and WOOLWORTHS HLDGS
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between DAX and WOOLWORTHS is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and WOOLWORTHS HLDGS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WOOLWORTHS HLDGS 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 WOOLWORTHS HLDGS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WOOLWORTHS HLDGS has no effect on the direction of DAX Index i.e., DAX Index and WOOLWORTHS HLDGS go up and down completely randomly.
Pair Corralation between DAX Index and WOOLWORTHS HLDGS
Assuming the 90 days trading horizon DAX Index is expected to generate 8.36 times less return on investment than WOOLWORTHS HLDGS. But when comparing it to its historical volatility, DAX Index is 8.87 times less risky than WOOLWORTHS HLDGS. It trades about 0.09 of its potential returns per unit of risk. WOOLWORTHS HLDGS is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 38.00 in WOOLWORTHS HLDGS on September 23, 2024 and sell it today you would earn a total of 292.00 from holding WOOLWORTHS HLDGS or generate 768.42% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
DAX Index vs. WOOLWORTHS HLDGS
Performance |
Timeline |
DAX Index and WOOLWORTHS HLDGS Volatility Contrast
Predicted Return Density |
Returns |
DAX Index
Pair trading matchups for DAX Index
WOOLWORTHS HLDGS
Pair trading matchups for WOOLWORTHS HLDGS
Pair Trading with DAX Index and WOOLWORTHS HLDGS
The main advantage of trading using opposite DAX Index and WOOLWORTHS HLDGS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, WOOLWORTHS HLDGS 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 WOOLWORTHS HLDGS will offset losses from the drop in WOOLWORTHS HLDGS's long position.DAX Index vs. alstria office REIT AG | DAX Index vs. OFFICE DEPOT | DAX Index vs. CHINA EDUCATION GROUP | DAX Index vs. MAVEN WIRELESS SWEDEN |
WOOLWORTHS HLDGS vs. Apple Inc | WOOLWORTHS HLDGS vs. Apple Inc | WOOLWORTHS HLDGS vs. Apple Inc | WOOLWORTHS HLDGS vs. Apple Inc |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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