Correlation Between Orange SA and Deutsche Telekom
Can any of the company-specific risk be diversified away by investing in both Orange SA and Deutsche Telekom 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 Orange SA and Deutsche Telekom into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Orange SA ADR and Deutsche Telekom AG, you can compare the effects of market volatilities on Orange SA and Deutsche Telekom 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 Orange SA with a short position of Deutsche Telekom. Check out your portfolio center. Please also check ongoing floating volatility patterns of Orange SA and Deutsche Telekom.
Diversification Opportunities for Orange SA and Deutsche Telekom
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Orange and Deutsche is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Orange SA ADR and Deutsche Telekom AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Deutsche Telekom and Orange SA 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 Orange SA ADR are associated (or correlated) with Deutsche Telekom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Deutsche Telekom has no effect on the direction of Orange SA i.e., Orange SA and Deutsche Telekom go up and down completely randomly.
Pair Corralation between Orange SA and Deutsche Telekom
If you would invest (100.00) in Deutsche Telekom AG on November 18, 2024 and sell it today you would earn a total of 100.00 from holding Deutsche Telekom AG or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Orange SA ADR vs. Deutsche Telekom AG
Performance |
| Timeline |
| Orange SA ADR |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
| Deutsche Telekom |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
Orange SA and Deutsche Telekom Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Orange SA and Deutsche Telekom
The main advantage of trading using opposite Orange SA and Deutsche Telekom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Orange SA position performs unexpectedly, Deutsche Telekom 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 Deutsche Telekom will offset losses from the drop in Deutsche Telekom's long position.| Orange SA vs. Telefonica Brasil SA | Orange SA vs. Vodafone Group PLC | Orange SA vs. Grupo Televisa SAB | Orange SA vs. America Movil SAB |
| Deutsche Telekom vs. KDDI Corp PK | Deutsche Telekom vs. Nippon Telegraph Telephone | Deutsche Telekom vs. Softbank Group Corp | Deutsche Telekom vs. KT Corporation |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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