Correlation Between Deutsche Bank and RYOHIN UNSPADR/1

Can any of the company-specific risk be diversified away by investing in both Deutsche Bank and RYOHIN UNSPADR/1 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 Bank and RYOHIN UNSPADR/1 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Deutsche Bank Aktiengesellschaft and RYOHIN UNSPADR1, you can compare the effects of market volatilities on Deutsche Bank and RYOHIN UNSPADR/1 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 Bank with a short position of RYOHIN UNSPADR/1. Check out your portfolio center. Please also check ongoing floating volatility patterns of Deutsche Bank and RYOHIN UNSPADR/1.

Diversification Opportunities for Deutsche Bank and RYOHIN UNSPADR/1

0.35

Correlation Coefficient

Deutsche Bank  RYOHIN UNSPADR/1

Weak diversification

The 3 months correlation between Deutsche and RYOHIN is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Deutsche Bank Aktiengesellscha and RYOHIN UNSPADR1 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RYOHIN UNSPADR/1 and Deutsche Bank 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 Bank Aktiengesellschaft are associated (or correlated) with RYOHIN UNSPADR/1. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RYOHIN UNSPADR/1 has no effect on the direction of Deutsche Bank i.e., Deutsche Bank and RYOHIN UNSPADR/1 go up and down completely randomly.

Pair Corralation between Deutsche Bank and RYOHIN UNSPADR/1

Assuming the 90 days horizon Deutsche Bank Aktiengesellschaft is expected to generate 1.15 times more return on investment than RYOHIN UNSPADR/1. However, Deutsche Bank is 1.15 times more volatile than RYOHIN UNSPADR1. It trades about 0.2 of its potential returns per unit of risk. RYOHIN UNSPADR1 is currently generating about 0.08 per unit of risk. If you would invest  1,670  in Deutsche Bank Aktiengesellschaft on December 30, 2024 and sell it today you would earn a total of  536.00  from holding Deutsche Bank Aktiengesellschaft or generate 32.1% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Deutsche Bank Aktiengesellscha  vs.  RYOHIN UNSPADR1

Deutsche Bank Aktien

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Deutsche Bank Aktiengesellschaft are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. Despite nearly unsteady basic indicators, Deutsche Bank reported solid returns over the last few months and may actually be approaching a breakup point.

RYOHIN UNSPADR/1

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in RYOHIN UNSPADR1 are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain forward-looking signals, RYOHIN UNSPADR/1 may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Deutsche Bank and RYOHIN UNSPADR/1

The main advantage of trading using opposite Deutsche Bank and RYOHIN UNSPADR/1 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Deutsche Bank position performs unexpectedly, RYOHIN UNSPADR/1 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 RYOHIN UNSPADR/1 will offset losses from the drop in RYOHIN UNSPADR/1's long position.

The idea behind Deutsche Bank Aktiengesellschaft and RYOHIN UNSPADR1 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.