Correlation Between OMX Helsinki and DAX Index
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By analyzing existing cross correlation between OMX Helsinki 25 and DAX Index, you can compare the effects of market volatilities on OMX Helsinki and DAX Index 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 OMX Helsinki with a short position of DAX Index. Check out your portfolio center. Please also check ongoing floating volatility patterns of OMX Helsinki and DAX Index.
Diversification Opportunities for OMX Helsinki and DAX Index
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between OMX and DAX is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding OMX Helsinki 25 and DAX Index in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DAX Index and OMX Helsinki 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 OMX Helsinki 25 are associated (or correlated) with DAX Index. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DAX Index has no effect on the direction of OMX Helsinki i.e., OMX Helsinki and DAX Index go up and down completely randomly.
Pair Corralation between OMX Helsinki and DAX Index
Assuming the 90 days trading horizon OMX Helsinki 25 is expected to generate 0.89 times more return on investment than DAX Index. However, OMX Helsinki 25 is 1.13 times less risky than DAX Index. It trades about 0.11 of its potential returns per unit of risk. DAX Index is currently generating about -0.04 per unit of risk. If you would invest 437,675 in OMX Helsinki 25 on January 30, 2024 and sell it today you would earn a total of 6,847 from holding OMX Helsinki 25 or generate 1.56% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
OMX Helsinki 25 vs. DAX Index
Performance |
Timeline |
OMX Helsinki and DAX Index Volatility Contrast
Predicted Return Density |
Returns |
OMX Helsinki 25
Pair trading matchups for OMX Helsinki
DAX Index
Pair trading matchups for DAX Index
Pair Trading with OMX Helsinki and DAX Index
The main advantage of trading using opposite OMX Helsinki and DAX Index positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OMX Helsinki position performs unexpectedly, DAX Index 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 DAX Index will offset losses from the drop in DAX Index's long position.OMX Helsinki vs. Detection Technology OY | OMX Helsinki vs. SSH Communications Security | OMX Helsinki vs. Alandsbanken Abp A | OMX Helsinki vs. QPR Software Oyj |
DAX Index vs. UMC Electronics Co | DAX Index vs. Renesas Electronics | DAX Index vs. Strategic Investments AS | DAX Index vs. Samsung Electronics Co |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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