Correlation Between Deutsche Real and Oklahoma Municipal
Can any of the company-specific risk be diversified away by investing in both Deutsche Real and Oklahoma Municipal 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 Real and Oklahoma Municipal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Deutsche Real Assets and Oklahoma Municipal Fund, you can compare the effects of market volatilities on Deutsche Real and Oklahoma Municipal 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 Real with a short position of Oklahoma Municipal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Deutsche Real and Oklahoma Municipal.
Diversification Opportunities for Deutsche Real and Oklahoma Municipal
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Deutsche and Oklahoma is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Deutsche Real Assets and Oklahoma Municipal Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oklahoma Municipal and Deutsche Real 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 Real Assets are associated (or correlated) with Oklahoma Municipal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oklahoma Municipal has no effect on the direction of Deutsche Real i.e., Deutsche Real and Oklahoma Municipal go up and down completely randomly.
Pair Corralation between Deutsche Real and Oklahoma Municipal
Assuming the 90 days horizon Deutsche Real Assets is expected to generate 2.51 times more return on investment than Oklahoma Municipal. However, Deutsche Real is 2.51 times more volatile than Oklahoma Municipal Fund. It trades about 0.09 of its potential returns per unit of risk. Oklahoma Municipal Fund is currently generating about 0.06 per unit of risk. If you would invest 1,145 in Deutsche Real Assets on September 3, 2024 and sell it today you would earn a total of 107.00 from holding Deutsche Real Assets or generate 9.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Deutsche Real Assets vs. Oklahoma Municipal Fund
Performance |
| Timeline |
| Deutsche Real Assets |
| Oklahoma Municipal |
Deutsche Real and Oklahoma Municipal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Deutsche Real and Oklahoma Municipal
The main advantage of trading using opposite Deutsche Real and Oklahoma Municipal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Deutsche Real position performs unexpectedly, Oklahoma Municipal 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 Oklahoma Municipal will offset losses from the drop in Oklahoma Municipal's long position.| Deutsche Real vs. Blackrock Gbl Alloc | Deutsche Real vs. Ivy Asset Strategy | Deutsche Real vs. Fpa Crescent Fund | Deutsche Real vs. Templeton Global Bond |
| Oklahoma Municipal vs. Limited Term Tax | Oklahoma Municipal vs. Calvert Short Duration | Oklahoma Municipal vs. Federated Short Term Income | Oklahoma Municipal vs. Jhancock Short Duration |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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