Correlation Between DWS and Global X
Can any of the company-specific risk be diversified away by investing in both DWS and Global X 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 DWS and Global X into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DWS and Global X MSCI, you can compare the effects of market volatilities on DWS and Global X 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 DWS with a short position of Global X. Check out your portfolio center. Please also check ongoing floating volatility patterns of DWS and Global X.
Diversification Opportunities for DWS and Global X
Very good diversification
The 3 months correlation between DWS and Global is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding DWS and Global X MSCI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global X MSCI and DWS 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 DWS are associated (or correlated) with Global X. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global X MSCI has no effect on the direction of DWS i.e., DWS and Global X go up and down completely randomly.
Pair Corralation between DWS and Global X
Given the investment horizon of 90 days DWS is expected to generate 0.85 times more return on investment than Global X. However, DWS is 1.17 times less risky than Global X. It trades about 0.08 of its potential returns per unit of risk. Global X MSCI is currently generating about 0.05 per unit of risk. If you would invest 2,044 in DWS on August 30, 2024 and sell it today you would earn a total of 492.00 from holding DWS or generate 24.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 81.85% |
| Values | Daily Returns |
DWS vs. Global X MSCI
Performance |
| Timeline |
| DWS |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Global X MSCI |
DWS and Global X Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DWS and Global X
The main advantage of trading using opposite DWS and Global X positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DWS position performs unexpectedly, Global X 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 Global X will offset losses from the drop in Global X's long position.| DWS vs. Xtrackers MSCI EAFE | DWS vs. iShares AsiaPacific Dividend | DWS vs. WBI Power Factor | DWS vs. Global X MSCI |
| Global X vs. Global X MSCI | Global X vs. Global X Alternative | Global X vs. First Trust Intl | Global X vs. iShares AsiaPacific Dividend |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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