Correlation Between Deutsche Telekom and COREBRIDGE FINANCIAL
Can any of the company-specific risk be diversified away by investing in both Deutsche Telekom and COREBRIDGE FINANCIAL 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 Telekom and COREBRIDGE FINANCIAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Deutsche Telekom AG and COREBRIDGE FINANCIAL INC, you can compare the effects of market volatilities on Deutsche Telekom and COREBRIDGE FINANCIAL 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 Telekom with a short position of COREBRIDGE FINANCIAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Deutsche Telekom and COREBRIDGE FINANCIAL.
Diversification Opportunities for Deutsche Telekom and COREBRIDGE FINANCIAL
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Deutsche and COREBRIDGE is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Deutsche Telekom AG and COREBRIDGE FINANCIAL INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on COREBRIDGE FINANCIAL INC and Deutsche Telekom 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 Telekom AG are associated (or correlated) with COREBRIDGE FINANCIAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of COREBRIDGE FINANCIAL INC has no effect on the direction of Deutsche Telekom i.e., Deutsche Telekom and COREBRIDGE FINANCIAL go up and down completely randomly.
Pair Corralation between Deutsche Telekom and COREBRIDGE FINANCIAL
Assuming the 90 days trading horizon Deutsche Telekom AG is expected to generate 0.33 times more return on investment than COREBRIDGE FINANCIAL. However, Deutsche Telekom AG is 3.01 times less risky than COREBRIDGE FINANCIAL. It trades about 0.23 of its potential returns per unit of risk. COREBRIDGE FINANCIAL INC is currently generating about 0.06 per unit of risk. If you would invest 2,257 in Deutsche Telekom AG on October 13, 2024 and sell it today you would earn a total of 687.00 from holding Deutsche Telekom AG or generate 30.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Deutsche Telekom AG vs. COREBRIDGE FINANCIAL INC
Performance |
| Timeline |
| Deutsche Telekom |
| COREBRIDGE FINANCIAL INC |
Deutsche Telekom and COREBRIDGE FINANCIAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Deutsche Telekom and COREBRIDGE FINANCIAL
The main advantage of trading using opposite Deutsche Telekom and COREBRIDGE FINANCIAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Deutsche Telekom position performs unexpectedly, COREBRIDGE FINANCIAL 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 COREBRIDGE FINANCIAL will offset losses from the drop in COREBRIDGE FINANCIAL's long position.| Deutsche Telekom vs. H2O Retailing | Deutsche Telekom vs. Mitsui Chemicals | Deutsche Telekom vs. GOODYEAR T RUBBER | Deutsche Telekom vs. Urban Outfitters |
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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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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