Correlation Between Bicicletas Monark and Deutsche Bank
Can any of the company-specific risk be diversified away by investing in both Bicicletas Monark and Deutsche Bank 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 Bicicletas Monark and Deutsche Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bicicletas Monark SA and Deutsche Bank Aktiengesellschaft, you can compare the effects of market volatilities on Bicicletas Monark and Deutsche Bank 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 Bicicletas Monark with a short position of Deutsche Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bicicletas Monark and Deutsche Bank.
Diversification Opportunities for Bicicletas Monark and Deutsche Bank
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Bicicletas and Deutsche is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Bicicletas Monark SA and Deutsche Bank Aktiengesellscha in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Deutsche Bank Aktien and Bicicletas Monark 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 Bicicletas Monark SA are associated (or correlated) with Deutsche Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Deutsche Bank Aktien has no effect on the direction of Bicicletas Monark i.e., Bicicletas Monark and Deutsche Bank go up and down completely randomly.
Pair Corralation between Bicicletas Monark and Deutsche Bank
Assuming the 90 days trading horizon Bicicletas Monark is expected to generate 8.28 times less return on investment than Deutsche Bank. In addition to that, Bicicletas Monark is 1.34 times more volatile than Deutsche Bank Aktiengesellschaft. It trades about 0.01 of its total potential returns per unit of risk. Deutsche Bank Aktiengesellschaft is currently generating about 0.13 per unit of volatility. If you would invest 6,012 in Deutsche Bank Aktiengesellschaft on September 2, 2024 and sell it today you would earn a total of 4,038 from holding Deutsche Bank Aktiengesellschaft or generate 67.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 90.69% |
| Values | Daily Returns |
Bicicletas Monark SA vs. Deutsche Bank Aktiengesellscha
Performance |
| Timeline |
| Bicicletas Monark |
| Deutsche Bank Aktien |
Bicicletas Monark and Deutsche Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bicicletas Monark and Deutsche Bank
The main advantage of trading using opposite Bicicletas Monark and Deutsche Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bicicletas Monark position performs unexpectedly, Deutsche Bank 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 Bank will offset losses from the drop in Deutsche Bank's long position.| Bicicletas Monark vs. Bombril SA | Bicicletas Monark vs. Bahema Educao SA | Bicicletas Monark vs. Banestes SA | Bicicletas Monark vs. Banco Alfa de |
| Deutsche Bank vs. Ita Unibanco Holding | Deutsche Bank vs. Banco Santander SA | Deutsche Bank vs. Itasa Investimentos |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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