Correlation Between Clough Global and Deutsche Real

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

By analyzing existing cross correlation between Clough Global Longshort and Deutsche Real Estate, you can compare the effects of market volatilities on Clough Global and Deutsche Real 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 Clough Global with a short position of Deutsche Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of Clough Global and Deutsche Real.

Diversification Opportunities for Clough Global and Deutsche Real

0.06

Correlation Coefficient

Clough Global  Deutsche Real

Significant diversification

The 3 months correlation between Clough and Deutsche is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Clough Global Longshort and Deutsche Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Deutsche Real Estate and Clough Global 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 Clough Global Longshort are associated (or correlated) with Deutsche Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Deutsche Real Estate has no effect on the direction of Clough Global i.e., Clough Global and Deutsche Real go up and down completely randomly.

Pair Corralation between Clough Global and Deutsche Real

If you would invest  846.00  in Clough Global Longshort on September 12, 2024 and sell it today you would earn a total of  0.00  from holding Clough Global Longshort or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	1.59%
Values	Daily Returns

Clough Global Longshort  vs.  Deutsche Real Estate

Clough Global Longshort

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Clough Global Longshort has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong fundamental indicators, Clough Global is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Deutsche Real Estate

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Deutsche Real Estate has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Deutsche Real is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Clough Global and Deutsche Real

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

The idea behind Clough Global Longshort and Deutsche Real Estate 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.