Correlation Between Elfun Diversified and Dws Emerging
Can any of the company-specific risk be diversified away by investing in both Elfun Diversified and Dws Emerging 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 Elfun Diversified and Dws Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Elfun Diversified Fund and Dws Emerging Markets, you can compare the effects of market volatilities on Elfun Diversified and Dws Emerging 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 Elfun Diversified with a short position of Dws Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Elfun Diversified and Dws Emerging.
Diversification Opportunities for Elfun Diversified and Dws Emerging
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Elfun and Dws is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Elfun Diversified Fund and Dws Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dws Emerging Markets and Elfun Diversified 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 Elfun Diversified Fund are associated (or correlated) with Dws Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dws Emerging Markets has no effect on the direction of Elfun Diversified i.e., Elfun Diversified and Dws Emerging go up and down completely randomly.
Pair Corralation between Elfun Diversified and Dws Emerging
Assuming the 90 days horizon Elfun Diversified Fund is expected to generate 0.58 times more return on investment than Dws Emerging. However, Elfun Diversified Fund is 1.72 times less risky than Dws Emerging. It trades about 0.07 of its potential returns per unit of risk. Dws Emerging Markets is currently generating about 0.02 per unit of risk. If you would invest 2,065 in Elfun Diversified Fund on September 28, 2024 and sell it today you would earn a total of 110.00 from holding Elfun Diversified Fund or generate 5.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Elfun Diversified Fund vs. Dws Emerging Markets
Performance |
| Timeline |
| Elfun Diversified |
| Dws Emerging Markets |
Elfun Diversified and Dws Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Elfun Diversified and Dws Emerging
The main advantage of trading using opposite Elfun Diversified and Dws Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Elfun Diversified position performs unexpectedly, Dws Emerging 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 Dws Emerging will offset losses from the drop in Dws Emerging's long position.| Elfun Diversified vs. State Street Target | Elfun Diversified vs. State Street Target | Elfun Diversified vs. Ssga International Stock | Elfun Diversified vs. State Street Target |
| Dws Emerging vs. Deutsche Gnma Fund | Dws Emerging vs. Deutsche Short Term Municipal | Dws Emerging vs. Deutsche Short Term Municipal | Dws Emerging vs. Deutsche Science And |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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