Correlation Between Deutsche Post and Dow Jones
Can any of the company-specific risk be diversified away by investing in both Deutsche Post and Dow Jones 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 Post and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Deutsche Post AG and Dow Jones Industrial, you can compare the effects of market volatilities on Deutsche Post and Dow Jones 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 Post with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of Deutsche Post and Dow Jones.
Diversification Opportunities for Deutsche Post and Dow Jones
-0.78 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Deutsche and Dow is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding Deutsche Post AG and Dow Jones Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dow Jones Industrial and Deutsche Post 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 Post AG are associated (or correlated) with Dow Jones. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dow Jones Industrial has no effect on the direction of Deutsche Post i.e., Deutsche Post and Dow Jones go up and down completely randomly.
Pair Corralation between Deutsche Post and Dow Jones
Assuming the 90 days trading horizon Deutsche Post is expected to generate 5.46 times less return on investment than Dow Jones. In addition to that, Deutsche Post is 1.94 times more volatile than Dow Jones Industrial. It trades about 0.01 of its total potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.08 per unit of volatility. If you would invest 3,394,710 in Dow Jones Industrial on August 26, 2024 and sell it today you would earn a total of 1,034,941 from holding Dow Jones Industrial or generate 30.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.6% |
| Values | Daily Returns |
Deutsche Post AG vs. Dow Jones Industrial
Performance |
| Timeline |
Deutsche Post and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
Deutsche Post AG
Pair trading matchups for Deutsche Post
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with Deutsche Post and Dow Jones
The main advantage of trading using opposite Deutsche Post and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Deutsche Post position performs unexpectedly, Dow Jones 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 Dow Jones will offset losses from the drop in Dow Jones' long position.| Deutsche Post vs. Samsung Electronics Co | Deutsche Post vs. Samsung Electronics Co | Deutsche Post vs. Hyundai Motor | Deutsche Post vs. Toyota Motor Corp |
| Dow Jones vs. MI Homes | Dow Jones vs. Franklin Street Properties | Dow Jones vs. Summit Hotel Properties | Dow Jones vs. Portillos |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
Other Complementary Tools
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk |