in finance is the statistical measure of how two different assets move in relation to each other. As you scroll down on the page, you'll notice four different time frames for the currency pairs you selected. Cut your risk in half on each trade. Dollar amount, it would appear that they have assumed two positions with two percent risk for each.
Forex Correlation Table : Are You Doubling Your Risk?
The following categories provide a quick way of interpreting the correlation tables values. One such strategy involves two strongly correlated currency pairs such as GBP/USD and EUR/USD. . A strong correlation is anything above 80, while weak/no correlations are anything below. Using correlation in forex trading also makes a trader more efficient, since they would tend to avoid holding positions which might ultimately cancel each other out due to negative correlation unless they wanted to have a partial hedge. At that point, a decline seen in GBP/USD would confirm the.S. A positive number means the currency pairs are positively correlated, while a negative number means they're negatively correlated. A positive correlation exists between assets that tend to move in the same direction.