Correlation Between Xtrackers ShortDAX and SHINHAN FINL
Can any of the company-specific risk be diversified away by investing in both Xtrackers ShortDAX and SHINHAN FINL 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 ShortDAX and SHINHAN FINL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xtrackers ShortDAX and SHINHAN FINL ADR1, you can compare the effects of market volatilities on Xtrackers ShortDAX and SHINHAN FINL 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 ShortDAX with a short position of SHINHAN FINL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xtrackers ShortDAX and SHINHAN FINL.
Diversification Opportunities for Xtrackers ShortDAX and SHINHAN FINL
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Xtrackers and SHINHAN is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding Xtrackers ShortDAX and SHINHAN FINL ADR1 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SHINHAN FINL ADR1 and Xtrackers ShortDAX 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 ShortDAX are associated (or correlated) with SHINHAN FINL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SHINHAN FINL ADR1 has no effect on the direction of Xtrackers ShortDAX i.e., Xtrackers ShortDAX and SHINHAN FINL go up and down completely randomly.
Pair Corralation between Xtrackers ShortDAX and SHINHAN FINL
Assuming the 90 days trading horizon Xtrackers ShortDAX is expected to under-perform the SHINHAN FINL. But the etf apears to be less risky and, when comparing its historical volatility, Xtrackers ShortDAX is 1.43 times less risky than SHINHAN FINL. The etf trades about -0.16 of its potential returns per unit of risk. The SHINHAN FINL ADR1 is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 3,005 in SHINHAN FINL ADR1 on April 23, 2025 and sell it today you would earn a total of 1,155 from holding SHINHAN FINL ADR1 or generate 38.44% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 98.44% |
Values | Daily Returns |
Xtrackers ShortDAX vs. SHINHAN FINL ADR1
Performance |
Timeline |
Xtrackers ShortDAX |
SHINHAN FINL ADR1 |
Xtrackers ShortDAX and SHINHAN FINL Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Xtrackers ShortDAX and SHINHAN FINL
The main advantage of trading using opposite Xtrackers ShortDAX and SHINHAN FINL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xtrackers ShortDAX position performs unexpectedly, SHINHAN FINL 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 SHINHAN FINL will offset losses from the drop in SHINHAN FINL's long position.Xtrackers ShortDAX vs. Xtrackers II Global | Xtrackers ShortDAX vs. Xtrackers FTSE | Xtrackers ShortDAX vs. Xtrackers SP 500 | Xtrackers ShortDAX vs. Xtrackers MSCI |
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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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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