Correlation Between Deutsche Post and SOCKET MOBILE

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

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

Diversification Opportunities for Deutsche Post and SOCKET MOBILE

-0.8

Correlation Coefficient

Deutsche Post  SOCKET MOBILE

Pay attention - limited upside

The 3 months correlation between Deutsche and SOCKET is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding Deutsche Post AG and SOCKET MOBILE NEW in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SOCKET MOBILE NEW and Deutsche Post 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 Post AG are associated (or correlated) with SOCKET MOBILE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SOCKET MOBILE NEW has no effect on the direction of Deutsche Post i.e., Deutsche Post and SOCKET MOBILE go up and down completely randomly.

Pair Corralation between Deutsche Post and SOCKET MOBILE

Assuming the 90 days trading horizon Deutsche Post AG is expected to generate 0.64 times more return on investment than SOCKET MOBILE. However, Deutsche Post AG is 1.56 times less risky than SOCKET MOBILE. It trades about 0.16 of its potential returns per unit of risk. SOCKET MOBILE NEW is currently generating about -0.07 per unit of risk. If you would invest  3,369  in Deutsche Post AG on December 22, 2024 and sell it today you would earn a total of  719.00  from holding Deutsche Post AG or generate 21.34% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Deutsche Post AG  vs.  SOCKET MOBILE NEW

Deutsche Post AG

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Deutsche Post AG are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite somewhat fragile essential indicators, Deutsche Post sustained solid returns over the last few months and may actually be approaching a breakup point.

SOCKET MOBILE NEW

Risk-Adjusted Performance

Very Weak

Over the last 90 days SOCKET MOBILE NEW has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's fundamental drivers remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Deutsche Post and SOCKET MOBILE

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

The idea behind Deutsche Post AG and SOCKET MOBILE NEW 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .