Correlation Between Deutsche Balaton and Deutsche Bank

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

By analyzing existing cross correlation between Deutsche Balaton AG and Deutsche Bank Aktiengesellschaft, you can compare the effects of market volatilities on Deutsche Balaton and Deutsche Bank 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 Deutsche Balaton with a short position of Deutsche Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Deutsche Balaton and Deutsche Bank.

Diversification Opportunities for Deutsche Balaton and Deutsche Bank

0.0

Correlation Coefficient

Deutsche Balaton  Deutsche Bank

Pay attention - limited upside

The 3 months correlation between Deutsche and Deutsche is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Deutsche Balaton AG and Deutsche Bank Aktiengesellscha in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Deutsche Bank Aktien and Deutsche Balaton 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 Deutsche Balaton AG are associated (or correlated) with Deutsche Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Deutsche Bank Aktien has no effect on the direction of Deutsche Balaton i.e., Deutsche Balaton and Deutsche Bank go up and down completely randomly.

Pair Corralation between Deutsche Balaton and Deutsche Bank

If you would invest  1,600  in Deutsche Bank Aktiengesellschaft on October 22, 2024 and sell it today you would earn a total of  251.00  from holding Deutsche Bank Aktiengesellschaft or generate 15.69% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Deutsche Balaton AG  vs.  Deutsche Bank Aktiengesellscha

Deutsche Balaton

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Deutsche Balaton AG has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent technical indicators, Deutsche Balaton is not utilizing all of its potentials. The current stock price mess, may contribute to short-term losses for the institutional investors.

Deutsche Bank Aktien

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Deutsche Bank Aktiengesellschaft are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain forward-looking signals, Deutsche Bank unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Deutsche Balaton and Deutsche Bank

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

The idea behind Deutsche Balaton AG and Deutsche Bank Aktiengesellschaft 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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.