Correlation Between Gaztransport Technigaz and Deutsche Telekom
Can any of the company-specific risk be diversified away by investing in both Gaztransport Technigaz and Deutsche Telekom 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 Gaztransport Technigaz and Deutsche Telekom into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gaztransport Technigaz SA and Deutsche Telekom AG, you can compare the effects of market volatilities on Gaztransport Technigaz and Deutsche Telekom 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 Gaztransport Technigaz with a short position of Deutsche Telekom. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gaztransport Technigaz and Deutsche Telekom.
Diversification Opportunities for Gaztransport Technigaz and Deutsche Telekom
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Gaztransport and Deutsche is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Gaztransport Technigaz SA and Deutsche Telekom AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Deutsche Telekom and Gaztransport Technigaz 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 Gaztransport Technigaz SA are associated (or correlated) with Deutsche Telekom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Deutsche Telekom has no effect on the direction of Gaztransport Technigaz i.e., Gaztransport Technigaz and Deutsche Telekom go up and down completely randomly.
Pair Corralation between Gaztransport Technigaz and Deutsche Telekom
Assuming the 90 days horizon Gaztransport Technigaz is expected to generate 3.14 times less return on investment than Deutsche Telekom. But when comparing it to its historical volatility, Gaztransport Technigaz SA is 1.08 times less risky than Deutsche Telekom. It trades about 0.04 of its potential returns per unit of risk. Deutsche Telekom AG is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 2,600 in Deutsche Telekom AG on September 2, 2024 and sell it today you would earn a total of 400.00 from holding Deutsche Telekom AG or generate 15.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gaztransport Technigaz SA vs. Deutsche Telekom AG
Performance |
| Timeline |
| Gaztransport Technigaz |
| Deutsche Telekom |
Gaztransport Technigaz and Deutsche Telekom Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gaztransport Technigaz and Deutsche Telekom
The main advantage of trading using opposite Gaztransport Technigaz and Deutsche Telekom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gaztransport Technigaz position performs unexpectedly, Deutsche Telekom 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 Telekom will offset losses from the drop in Deutsche Telekom's long position.| Gaztransport Technigaz vs. Superior Plus Corp | Gaztransport Technigaz vs. NMI Holdings | Gaztransport Technigaz vs. Origin Agritech | Gaztransport Technigaz vs. SIVERS SEMICONDUCTORS AB |
| Deutsche Telekom vs. Charter Communications | Deutsche Telekom vs. LG Display Co | Deutsche Telekom vs. Spirent Communications plc | Deutsche Telekom vs. Universal Display |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
Other Complementary Tools
| Stocks Directory Find actively traded stocks across global markets | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas |