Correlation Between Deutsche Munications and Deutsche Multi

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

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

Diversification Opportunities for Deutsche Munications and Deutsche Multi

0.91

Correlation Coefficient

Deutsche Munications  Deutsche Multi

Almost no diversification

The 3 months correlation between Deutsche and Deutsche is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Deutsche Munications Fund and Deutsche Multi Asset Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Deutsche Multi Asset and Deutsche Munications 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 Munications Fund are associated (or correlated) with Deutsche Multi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Deutsche Multi Asset has no effect on the direction of Deutsche Munications i.e., Deutsche Munications and Deutsche Multi go up and down completely randomly.

Pair Corralation between Deutsche Munications and Deutsche Multi

Assuming the 90 days horizon Deutsche Munications Fund is expected to generate 1.41 times more return on investment than Deutsche Multi. However, Deutsche Munications is 1.41 times more volatile than Deutsche Multi Asset Global. It trades about 0.29 of its potential returns per unit of risk. Deutsche Multi Asset Global is currently generating about 0.17 per unit of risk. If you would invest  3,395  in Deutsche Munications Fund on September 14, 2024 and sell it today you would earn a total of  505.00  from holding Deutsche Munications Fund or generate 14.87% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	96.83%
Values	Daily Returns

Deutsche Munications Fund  vs.  Deutsche Multi Asset Global

Deutsche Munications

Risk-Adjusted Performance

22 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Deutsche Munications Fund are ranked lower than 22 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak technical indicators, Deutsche Munications showed solid returns over the last few months and may actually be approaching a breakup point.

Deutsche Multi Asset

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Deutsche Multi Asset Global are ranked lower than 13 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Deutsche Multi is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Deutsche Munications and Deutsche Multi

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

The idea behind Deutsche Munications Fund and Deutsche Multi Asset Global 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 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..