Correlation Between Pacteo Actions and DWS Aktien

Can any of the company-specific risk be diversified away by investing in both Pacteo Actions and DWS Aktien 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 Pacteo Actions and DWS Aktien into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Pacteo Actions Europe and DWS Aktien Strategie, you can compare the effects of market volatilities on Pacteo Actions and DWS Aktien 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 Pacteo Actions with a short position of DWS Aktien. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pacteo Actions and DWS Aktien.

Diversification Opportunities for Pacteo Actions and DWS Aktien

0.64

Correlation Coefficient

Pacteo Actions  DWS Aktien

Poor diversification

The 3 months correlation between Pacteo and DWS is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Pacteo Actions Europe and DWS Aktien Strategie in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DWS Aktien Strategie and Pacteo Actions 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 Pacteo Actions Europe are associated (or correlated) with DWS Aktien. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DWS Aktien Strategie has no effect on the direction of Pacteo Actions i.e., Pacteo Actions and DWS Aktien go up and down completely randomly.

Pair Corralation between Pacteo Actions and DWS Aktien

Assuming the 90 days trading horizon Pacteo Actions is expected to generate 2.57 times less return on investment than DWS Aktien. But when comparing it to its historical volatility, Pacteo Actions Europe is 1.24 times less risky than DWS Aktien. It trades about 0.05 of its potential returns per unit of risk. DWS Aktien Strategie is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest  49,525  in DWS Aktien Strategie on September 23, 2024 and sell it today you would earn a total of  754.00  from holding DWS Aktien Strategie or generate 1.52% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	95.45%
Values	Daily Returns

Pacteo Actions Europe  vs.  DWS Aktien Strategie

Pacteo Actions Europe

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Pacteo Actions Europe has generated negative risk-adjusted returns adding no value to fund investors. Despite somewhat strong basic indicators, Pacteo Actions is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

DWS Aktien Strategie

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in DWS Aktien Strategie are ranked lower than 1 (%) of all funds and portfolios of funds over the last 90 days. Despite nearly stable basic indicators, DWS Aktien is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Pacteo Actions and DWS Aktien

The main advantage of trading using opposite Pacteo Actions and DWS Aktien positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pacteo Actions position performs unexpectedly, DWS Aktien 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 DWS Aktien will offset losses from the drop in DWS Aktien's long position.

The idea behind Pacteo Actions Europe and DWS Aktien Strategie pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.