Correlation Between Xtrackers LevDAX and ASM Pacific
Can any of the company-specific risk be diversified away by investing in both Xtrackers LevDAX and ASM Pacific 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 LevDAX and ASM Pacific into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xtrackers LevDAX and ASM Pacific Technology, you can compare the effects of market volatilities on Xtrackers LevDAX and ASM Pacific 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 LevDAX with a short position of ASM Pacific. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xtrackers LevDAX and ASM Pacific.
Diversification Opportunities for Xtrackers LevDAX and ASM Pacific
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Xtrackers and ASM is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Xtrackers LevDAX and ASM Pacific Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ASM Pacific Technology and Xtrackers LevDAX 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 LevDAX are associated (or correlated) with ASM Pacific. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ASM Pacific Technology has no effect on the direction of Xtrackers LevDAX i.e., Xtrackers LevDAX and ASM Pacific go up and down completely randomly.
Pair Corralation between Xtrackers LevDAX and ASM Pacific
Assuming the 90 days trading horizon Xtrackers LevDAX is expected to generate 0.73 times more return on investment than ASM Pacific. However, Xtrackers LevDAX is 1.37 times less risky than ASM Pacific. It trades about 0.16 of its potential returns per unit of risk. ASM Pacific Technology is currently generating about 0.11 per unit of risk. If you would invest 24,275 in Xtrackers LevDAX on April 25, 2025 and sell it today you would earn a total of 4,465 from holding Xtrackers LevDAX or generate 18.39% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Xtrackers LevDAX vs. ASM Pacific Technology
Performance |
Timeline |
Xtrackers LevDAX |
ASM Pacific Technology |
Xtrackers LevDAX and ASM Pacific Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Xtrackers LevDAX and ASM Pacific
The main advantage of trading using opposite Xtrackers LevDAX and ASM Pacific positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xtrackers LevDAX position performs unexpectedly, ASM Pacific 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 ASM Pacific will offset losses from the drop in ASM Pacific's long position.Xtrackers LevDAX vs. Xtrackers II Global | Xtrackers LevDAX vs. Xtrackers FTSE | Xtrackers LevDAX vs. Xtrackers SP 500 | Xtrackers LevDAX vs. Xtrackers MSCI |
ASM Pacific vs. SOFI TECHNOLOGIES | ASM Pacific vs. ORMAT TECHNOLOGIES | ASM Pacific vs. AAC TECHNOLOGHLDGADR | ASM Pacific vs. ZURICH INSURANCE GROUP |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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