Correlation Between DAX Index and HOYA
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By analyzing existing cross correlation between DAX Index and HOYA Corporation, you can compare the effects of market volatilities on DAX Index and HOYA 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 HOYA. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and HOYA.
Diversification Opportunities for DAX Index and HOYA
Poor diversification
The 3 months correlation between DAX and HOYA is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and HOYA Corp. in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HOYA 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 HOYA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HOYA has no effect on the direction of DAX Index i.e., DAX Index and HOYA go up and down completely randomly.
Pair Corralation between DAX Index and HOYA
Assuming the 90 days trading horizon DAX Index is expected to generate 5.68 times less return on investment than HOYA. But when comparing it to its historical volatility, DAX Index is 8.22 times less risky than HOYA. It trades about 0.19 of its potential returns per unit of risk. HOYA Corporation is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 8,017 in HOYA Corporation on September 7, 2024 and sell it today you would earn a total of 4,658 from holding HOYA Corporation or generate 58.1% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
DAX Index vs. HOYA Corp.
Performance |
Timeline |
DAX Index and HOYA Volatility Contrast
Predicted Return Density |
Returns |
DAX Index
Pair trading matchups for DAX Index
HOYA Corporation
Pair trading matchups for HOYA
Pair Trading with DAX Index and HOYA
The main advantage of trading using opposite DAX Index and HOYA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, HOYA 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 HOYA will offset losses from the drop in HOYA's long position.DAX Index vs. Direct Line Insurance | DAX Index vs. Tencent Music Entertainment | DAX Index vs. INSURANCE AUST GRP | DAX Index vs. TOWNSQUARE MEDIA INC |
HOYA vs. Clearside Biomedical | HOYA vs. KENEDIX OFFICE INV | HOYA vs. Entravision Communications | HOYA vs. Charter Communications |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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