Correlation Analysis Between Shanghai and DAX

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

Comparative Performance

 Predicted Return Density 

Shanghai  vs.  DAX

 Performance (%) 

Pair Volatility

Assuming 30 trading days horizon, Shanghai is expected to generate 0.79 times more return on investment than DAX. However, Shanghai is 1.27 times less risky than DAX. It trades about 0.27 of its potential returns per unit of risk. DAX is currently generating about 0.11 per unit of risk. If you would invest  253,627  in Shanghai on January 18, 2019 and sell it today you would earn a total of  18,343  from holding Shanghai or generate 7.23% return on investment over 30 days.

Pair Corralation between Shanghai and DAX

Time Period2 Months [change]
ValuesDaily Returns

Diversification Opportunities for Shanghai and DAX

Shanghai diversification synergy

Very good diversification

Overlapping area represents the amount of risk that can be diversified away by holding Shanghai and DAX in the same portfolio assuming nothing else is changed. The correlation between historical prices or returns on DAX and Shanghai 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 Shanghai 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 Shanghai i.e. Shanghai and DAX go up and down completely randomly.

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