Correlation Between DAX Index and Amazon
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By analyzing existing cross correlation between DAX Index and Amazon Inc, you can compare the effects of market volatilities on DAX Index and Amazon 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 Index with a short position of Amazon. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and Amazon.
Diversification Opportunities for DAX Index and Amazon
Significant diversification
The 3 months correlation between DAX and Amazon is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and Amazon Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amazon Inc and DAX Index 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 Index are associated (or correlated) with Amazon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amazon Inc has no effect on the direction of DAX Index i.e., DAX Index and Amazon go up and down completely randomly.
Pair Corralation between DAX Index and Amazon
Assuming the 90 days trading horizon DAX Index is expected to under-perform the Amazon. But the index apears to be less risky and, when comparing its historical volatility, DAX Index is 1.77 times less risky than Amazon. The index trades about -0.21 of its potential returns per unit of risk. The Amazon Inc is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 17,052 in Amazon Inc on March 21, 2024 and sell it today you would lose (42.00) from holding Amazon Inc or give up 0.25% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
DAX Index vs. Amazon Inc
Performance |
Timeline |
DAX Index and Amazon Volatility Contrast
Predicted Return Density |
Returns |
DAX Index
Pair trading matchups for DAX Index
Amazon Inc
Pair trading matchups for Amazon
Pair Trading with DAX Index and Amazon
The main advantage of trading using opposite DAX Index and Amazon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, Amazon 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 Amazon will offset losses from the drop in Amazon's long position.DAX Index vs. Corporate Office Properties | DAX Index vs. FANTASMA GAMES AB | DAX Index vs. Boyd Gaming | DAX Index vs. GAMING FAC SA |
Amazon vs. Q2M Managementberatung AG | Amazon vs. IMPERIAL TOBACCO | Amazon vs. WESTFIELD RETAIL TR | Amazon vs. Retail Estates NV |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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