Correlation Analysis Between DAX and Shanghai

This module allows you to analyze existing cross correlation between DAX and Shanghai. You can compare the effects of market volatilities on DAX and Shanghai 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 with a short position of Shanghai. See also your portfolio center. Please also check ongoing floating volatility patterns of DAX and Shanghai.
Horizon     30 Days    Login   to change

DAX  vs.  Shanghai

 Performance (%) 

Pair Volatility

Assuming 30 trading days horizon, DAX is expected to generate 1.7 times less return on investment than Shanghai. But when comparing it to its historical volatility, DAX is 1.04 times less risky than Shanghai. It trades about 0.03 of its potential returns per unit of risk. Shanghai is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  277,230  in Shanghai on August 25, 2018 and sell it today you would earn a total of  2,518  from holding Shanghai or generate 0.91% return on investment over 30 days.

Pair Corralation between DAX and Shanghai

Time Period1 Month [change]
ValuesDaily Returns


Poor diversification

Overlapping area represents the amount of risk that can be diversified away by holding DAX and Shanghai in the same portfolio assuming nothing else is changed. The correlation between historical prices or returns on Shanghai and DAX 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 are associated (or correlated) with Shanghai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai has no effect on the direction of DAX i.e. DAX and Shanghai go up and down completely randomly.

Comparative Volatility

 Predicted Return Density 

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