Correlation Between Xtrackers ShortDAX and COFFEE HOLDING
Can any of the company-specific risk be diversified away by investing in both Xtrackers ShortDAX and COFFEE HOLDING at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Xtrackers ShortDAX and COFFEE HOLDING into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xtrackers ShortDAX and COFFEE HOLDING, you can compare the effects of market volatilities on Xtrackers ShortDAX and COFFEE HOLDING 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 Xtrackers ShortDAX with a short position of COFFEE HOLDING. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xtrackers ShortDAX and COFFEE HOLDING.
Diversification Opportunities for Xtrackers ShortDAX and COFFEE HOLDING
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Xtrackers and COFFEE is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Xtrackers ShortDAX and COFFEE HOLDING in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on COFFEE HOLDING and Xtrackers ShortDAX 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 Xtrackers ShortDAX are associated (or correlated) with COFFEE HOLDING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of COFFEE HOLDING has no effect on the direction of Xtrackers ShortDAX i.e., Xtrackers ShortDAX and COFFEE HOLDING go up and down completely randomly.
Pair Corralation between Xtrackers ShortDAX and COFFEE HOLDING
Assuming the 90 days trading horizon Xtrackers ShortDAX is expected to generate 0.54 times more return on investment than COFFEE HOLDING. However, Xtrackers ShortDAX is 1.84 times less risky than COFFEE HOLDING. It trades about 0.02 of its potential returns per unit of risk. COFFEE HOLDING is currently generating about -0.03 per unit of risk. If you would invest 54.00 in Xtrackers ShortDAX on August 31, 2025 and sell it today you would earn a total of 1.00 from holding Xtrackers ShortDAX or generate 1.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xtrackers ShortDAX vs. COFFEE HOLDING
Performance |
| Timeline |
| Xtrackers ShortDAX |
| COFFEE HOLDING |
Xtrackers ShortDAX and COFFEE HOLDING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xtrackers ShortDAX and COFFEE HOLDING
The main advantage of trading using opposite Xtrackers ShortDAX and COFFEE HOLDING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xtrackers ShortDAX position performs unexpectedly, COFFEE HOLDING 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 COFFEE HOLDING will offset losses from the drop in COFFEE HOLDING's long position.| Xtrackers ShortDAX vs. Xtrackers II Global | Xtrackers ShortDAX vs. Xtrackers FTSE | Xtrackers ShortDAX vs. Xtrackers SP 500 | Xtrackers ShortDAX vs. Xtrackers MSCI |
| COFFEE HOLDING vs. Boyd Gaming | COFFEE HOLDING vs. Alibaba Health Information | COFFEE HOLDING vs. FUTURE GAMING GRP | COFFEE HOLDING vs. BRAGG GAMING GRP |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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