Correlation Between Deutsche Bank and Global Star
Can any of the company-specific risk be diversified away by investing in both Deutsche Bank and Global Star 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 Global Star into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Deutsche Bank AG and Global Star Acquisition, you can compare the effects of market volatilities on Deutsche Bank and Global Star 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 Global Star. Check out your portfolio center. Please also check ongoing floating volatility patterns of Deutsche Bank and Global Star.
Diversification Opportunities for Deutsche Bank and Global Star
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Deutsche and Global is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Deutsche Bank AG and Global Star Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Star Acquisition 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 AG are associated (or correlated) with Global Star. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Star Acquisition has no effect on the direction of Deutsche Bank i.e., Deutsche Bank and Global Star go up and down completely randomly.
Pair Corralation between Deutsche Bank and Global Star
Allowing for the 90-day total investment horizon Deutsche Bank AG is expected to generate 0.92 times more return on investment than Global Star. However, Deutsche Bank AG is 1.09 times less risky than Global Star. It trades about 0.09 of its potential returns per unit of risk. Global Star Acquisition is currently generating about 0.02 per unit of risk. If you would invest 1,001 in Deutsche Bank AG on September 6, 2024 and sell it today you would earn a total of 746.00 from holding Deutsche Bank AG or generate 74.53% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 99.75% |
Values | Daily Returns |
Deutsche Bank AG vs. Global Star Acquisition
Performance |
Timeline |
Deutsche Bank AG |
Global Star Acquisition |
Deutsche Bank and Global Star Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Deutsche Bank and Global Star
The main advantage of trading using opposite Deutsche Bank and Global Star positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Deutsche Bank position performs unexpectedly, Global Star 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 Global Star will offset losses from the drop in Global Star's long position.Deutsche Bank vs. Banco Bradesco SA | Deutsche Bank vs. Itau Unibanco Banco | Deutsche Bank vs. Western Alliance Bancorporation | Deutsche Bank vs. Comerica |
Global Star vs. Zane Interactive Publishing | Global Star vs. Skillful Craftsman Education | Global Star vs. Udemy Inc | Global Star vs. Inflection Point Acquisition |
Check out your portfolio center.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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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