This module allows you to analyze existing cross correlation between NIKKEI 225 and IBEX 35. You can compare the effects of market volatilities on NIKKEI 225 and IBEX 35 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 NIKKEI 225 with a short position of IBEX 35. See also your portfolio center. Please also check ongoing floating volatility patterns of NIKKEI 225 and IBEX 35.
|Horizon||30 Days Login to change|
Predicted Return Density
NIKKEI 225 vs. IBEX 35
Assuming 30 trading days horizon, NIKKEI 225 is expected to under-perform the IBEX 35. In addition to that, NIKKEI 225 is 1.03 times more volatile than IBEX 35. It trades about -0.21 of its total potential returns per unit of risk. IBEX 35 is currently generating about -0.16 per unit of volatility. If you would invest 958,190 in IBEX 35 on May 19, 2019 and sell it today you would lose (44,060) from holding IBEX 35 or give up 4.6% of portfolio value over 30 days.
Pair Corralation between NIKKEI 225 and IBEX 35
|Time Period||2 Months [change]|
Diversification Opportunities for NIKKEI 225 and IBEX 35
Very weak diversification
Overlapping area represents the amount of risk that can be diversified away by holding NIKKEI 225 and IBEX 35 in the same portfolio assuming nothing else is changed. The correlation between historical prices or returns on IBEX 35 and NIKKEI 225 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 NIKKEI 225 are associated (or correlated) with IBEX 35. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IBEX 35 has no effect on the direction of NIKKEI 225 i.e. NIKKEI 225 and IBEX 35 go up and down completely randomly.
See also your portfolio center. Please also try Bollinger Bands module to use bollinger bands indicator to analyze target price for a given investing horizon.