Correlation Between MTY Food and DAX Index
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By analyzing existing cross correlation between MTY Food Group and DAX Index, you can compare the effects of market volatilities on MTY Food and DAX 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 MTY Food with a short position of DAX Index. Check out your portfolio center. Please also check ongoing floating volatility patterns of MTY Food and DAX Index.
Diversification Opportunities for MTY Food and DAX Index
Weak diversification
The 3 months correlation between MTY and DAX is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding MTY Food Group and DAX Index in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DAX Index and MTY Food 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 MTY Food Group are associated (or correlated) with DAX Index. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DAX Index has no effect on the direction of MTY Food i.e., MTY Food and DAX Index go up and down completely randomly.
Pair Corralation between MTY Food and DAX Index
Assuming the 90 days horizon MTY Food is expected to generate 5.46 times less return on investment than DAX Index. In addition to that, MTY Food is 2.0 times more volatile than DAX Index. It trades about 0.01 of its total potential returns per unit of risk. DAX Index is currently generating about 0.16 per unit of volatility. If you would invest 1,946,119 in DAX Index on October 21, 2024 and sell it today you would earn a total of 144,220 from holding DAX Index or generate 7.41% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
MTY Food Group vs. DAX Index
Performance |
Timeline |
MTY Food and DAX Index Volatility Contrast
Predicted Return Density |
Returns |
MTY Food Group
Pair trading matchups for MTY Food
DAX Index
Pair trading matchups for DAX Index
Pair Trading with MTY Food and DAX Index
The main advantage of trading using opposite MTY Food and DAX Index positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MTY Food position performs unexpectedly, DAX 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 DAX Index will offset losses from the drop in DAX Index's long position.MTY Food vs. McDonalds | ||
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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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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