Correlation Between TrueShares Structured and DBX ETF

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Can any of the company-specific risk be diversified away by investing in both TrueShares Structured and DBX ETF 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 TrueShares Structured and DBX ETF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TrueShares Structured Outcome and DBX ETF Trust, you can compare the effects of market volatilities on TrueShares Structured and DBX ETF 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 TrueShares Structured with a short position of DBX ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of TrueShares Structured and DBX ETF.

Diversification Opportunities for TrueShares Structured and DBX ETF

TrueSharesDBXDiversified AwayTrueSharesDBXDiversified Away100%
0.72
  Correlation Coefficient

Poor diversification

The 3 months correlation between TrueShares and DBX is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding TrueShares Structured Outcome and DBX ETF Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DBX ETF Trust and TrueShares Structured 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 TrueShares Structured Outcome are associated (or correlated) with DBX ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DBX ETF Trust has no effect on the direction of TrueShares Structured i.e., TrueShares Structured and DBX ETF go up and down completely randomly.

Pair Corralation between TrueShares Structured and DBX ETF

Given the investment horizon of 90 days TrueShares Structured is expected to generate 1.74 times less return on investment than DBX ETF. But when comparing it to its historical volatility, TrueShares Structured Outcome is 1.59 times less risky than DBX ETF. It trades about 0.06 of its potential returns per unit of risk. DBX ETF Trust is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  3,083  in DBX ETF Trust on October 30, 2024 and sell it today you would earn a total of  127.00  from holding DBX ETF Trust or generate 4.12% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy98.33%
ValuesDaily Returns

TrueShares Structured Outcome  vs.  DBX ETF Trust

 Performance 
JavaScript chart by amCharts 3.21.15NovDec2025 -2024
JavaScript chart by amCharts 3.21.15SEPZ MIDE
       Timeline  
TrueShares Structured 

Risk-Adjusted Performance

4 of 100

 
Weak
 
Strong
Insignificant
Compared to the overall equity markets, risk-adjusted returns on investments in TrueShares Structured Outcome are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong basic indicators, TrueShares Structured is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan37.53838.53939.5
DBX ETF Trust 

Risk-Adjusted Performance

5 of 100

 
Weak
 
Strong
Modest
Compared to the overall equity markets, risk-adjusted returns on investments in DBX ETF Trust are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound fundamental indicators, DBX ETF is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan30.53131.53232.533

TrueShares Structured and DBX ETF Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-1.98-1.47-0.96-0.450.03470.511.021.532.042.55 0.20.40.60.8
JavaScript chart by amCharts 3.21.15SEPZ MIDE
       Returns  

Pair Trading with TrueShares Structured and DBX ETF

The main advantage of trading using opposite TrueShares Structured and DBX ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TrueShares Structured position performs unexpectedly, DBX ETF 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 DBX ETF will offset losses from the drop in DBX ETF's long position.
The idea behind TrueShares Structured Outcome and DBX ETF Trust 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.

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