Correlation Between Deutsche Bank and Singapore Telecommunicatio
Can any of the company-specific risk be diversified away by investing in both Deutsche Bank and Singapore Telecommunicatio 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 Bank and Singapore Telecommunicatio into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Deutsche Bank Aktiengesellschaft and Singapore Telecommunications Limited, you can compare the effects of market volatilities on Deutsche Bank and Singapore Telecommunicatio 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 Bank with a short position of Singapore Telecommunicatio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Deutsche Bank and Singapore Telecommunicatio.
Diversification Opportunities for Deutsche Bank and Singapore Telecommunicatio
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Deutsche and Singapore is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Deutsche Bank Aktiengesellscha and Singapore Telecommunications L in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Singapore Telecommunicatio and Deutsche Bank 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 Bank Aktiengesellschaft are associated (or correlated) with Singapore Telecommunicatio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Singapore Telecommunicatio has no effect on the direction of Deutsche Bank i.e., Deutsche Bank and Singapore Telecommunicatio go up and down completely randomly.
Pair Corralation between Deutsche Bank and Singapore Telecommunicatio
Assuming the 90 days trading horizon Deutsche Bank Aktiengesellschaft is expected to generate 1.0 times more return on investment than Singapore Telecommunicatio. However, Deutsche Bank is 1.0 times more volatile than Singapore Telecommunications Limited. It trades about 0.16 of its potential returns per unit of risk. Singapore Telecommunications Limited is currently generating about 0.13 per unit of risk. If you would invest 1,896 in Deutsche Bank Aktiengesellschaft on November 28, 2024 and sell it today you would earn a total of 115.00 from holding Deutsche Bank Aktiengesellschaft or generate 6.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Deutsche Bank Aktiengesellscha vs. Singapore Telecommunications L
Performance |
| Timeline |
| Deutsche Bank Aktien |
| Singapore Telecommunicatio |
Deutsche Bank and Singapore Telecommunicatio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Deutsche Bank and Singapore Telecommunicatio
The main advantage of trading using opposite Deutsche Bank and Singapore Telecommunicatio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Deutsche Bank position performs unexpectedly, Singapore Telecommunicatio 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 Singapore Telecommunicatio will offset losses from the drop in Singapore Telecommunicatio's long position.| Deutsche Bank vs. SHELF DRILLING LTD | Deutsche Bank vs. CITY OFFICE REIT | Deutsche Bank vs. Air Transport Services | Deutsche Bank vs. OFFICE DEPOT |
| Singapore Telecommunicatio vs. Pets at Home | Singapore Telecommunicatio vs. Cembra Money Bank | Singapore Telecommunicatio vs. PRINCIPAL FINANCIAL | Singapore Telecommunicatio vs. CENTURIA OFFICE REIT |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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