Correlation Between Deutsche Post and Deere
Can any of the company-specific risk be diversified away by investing in both Deutsche Post and Deere 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 Deere 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 Deere Company, you can compare the effects of market volatilities on Deutsche Post and Deere 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 Deere. Check out your portfolio center. Please also check ongoing floating volatility patterns of Deutsche Post and Deere.
Diversification Opportunities for Deutsche Post and Deere
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Deutsche and Deere is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Deutsche Post AG and Deere Company in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Deere Company 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 Deere. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Deere Company has no effect on the direction of Deutsche Post i.e., Deutsche Post and Deere go up and down completely randomly.
Pair Corralation between Deutsche Post and Deere
Assuming the 90 days horizon Deutsche Post AG is expected to under-perform the Deere. In addition to that, Deutsche Post is 1.09 times more volatile than Deere Company. It trades about -0.18 of its total potential returns per unit of risk. Deere Company is currently generating about 0.28 per unit of volatility. If you would invest 40,604 in Deere Company on August 30, 2024 and sell it today you would earn a total of 5,996 from holding Deere Company or generate 14.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Deutsche Post AG vs. Deere Company
Performance |
| Timeline |
| Deutsche Post AG |
| Deere Company |
Deutsche Post and Deere Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Deutsche Post and Deere
The main advantage of trading using opposite Deutsche Post and Deere positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Deutsche Post position performs unexpectedly, Deere 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 Deere will offset losses from the drop in Deere's long position.| Deutsche Post vs. CH Robinson Worldwide | Deutsche Post vs. Kuehne Nagel International | Deutsche Post vs. United Parcel Service | Deutsche Post vs. Expeditors International of |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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