Correlation Between Deutsche Bank and Autohome
Can any of the company-specific risk be diversified away by investing in both Deutsche Bank and Autohome 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 Autohome 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 Autohome, you can compare the effects of market volatilities on Deutsche Bank and Autohome 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 Autohome. Check out your portfolio center. Please also check ongoing floating volatility patterns of Deutsche Bank and Autohome.
Diversification Opportunities for Deutsche Bank and Autohome
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Deutsche and Autohome is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Deutsche Bank Aktiengesellscha and Autohome in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Autohome 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 Autohome. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Autohome has no effect on the direction of Deutsche Bank i.e., Deutsche Bank and Autohome go up and down completely randomly.
Pair Corralation between Deutsche Bank and Autohome
Assuming the 90 days trading horizon Deutsche Bank Aktiengesellschaft is expected to generate 0.66 times more return on investment than Autohome. However, Deutsche Bank Aktiengesellschaft is 1.51 times less risky than Autohome. It trades about 0.17 of its potential returns per unit of risk. Autohome is currently generating about 0.01 per unit of risk. If you would invest 9,378 in Deutsche Bank Aktiengesellschaft on September 23, 2024 and sell it today you would earn a total of 1,644 from holding Deutsche Bank Aktiengesellschaft or generate 17.53% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Deutsche Bank Aktiengesellscha vs. Autohome
Performance |
Timeline |
Deutsche Bank Aktien |
Autohome |
Deutsche Bank and Autohome Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Deutsche Bank and Autohome
The main advantage of trading using opposite Deutsche Bank and Autohome positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Deutsche Bank position performs unexpectedly, Autohome 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 Autohome will offset losses from the drop in Autohome's long position.Deutsche Bank vs. MAHLE Metal Leve | Deutsche Bank vs. Apartment Investment and | Deutsche Bank vs. Beyond Meat | Deutsche Bank vs. UnitedHealth Group Incorporated |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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