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