Correlation Between Deutsche Multi and State Street
Can any of the company-specific risk be diversified away by investing in both Deutsche Multi and State Street 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 Multi and State Street into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Deutsche Multi Asset Moderate and State Street Global, you can compare the effects of market volatilities on Deutsche Multi and State Street 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 Multi with a short position of State Street. Check out your portfolio center. Please also check ongoing floating volatility patterns of Deutsche Multi and State Street.
Diversification Opportunities for Deutsche Multi and State Street
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Deutsche and State is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Deutsche Multi Asset Moderate and State Street Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on State Street Global and Deutsche Multi 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 Multi Asset Moderate are associated (or correlated) with State Street. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of State Street Global has no effect on the direction of Deutsche Multi i.e., Deutsche Multi and State Street go up and down completely randomly.
Pair Corralation between Deutsche Multi and State Street
Assuming the 90 days horizon Deutsche Multi Asset Moderate is expected to generate 0.7 times more return on investment than State Street. However, Deutsche Multi Asset Moderate is 1.43 times less risky than State Street. It trades about 0.09 of its potential returns per unit of risk. State Street Global is currently generating about 0.06 per unit of risk. If you would invest 811.00 in Deutsche Multi Asset Moderate on September 12, 2024 and sell it today you would earn a total of 222.00 from holding Deutsche Multi Asset Moderate or generate 27.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Deutsche Multi Asset Moderate vs. State Street Global
Performance |
| Timeline |
| Deutsche Multi Asset |
| State Street Global |
Deutsche Multi and State Street Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Deutsche Multi and State Street
The main advantage of trading using opposite Deutsche Multi and State Street positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Deutsche Multi position performs unexpectedly, State Street 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 State Street will offset losses from the drop in State Street's long position.| Deutsche Multi vs. Strategic Allocation Servative | Deutsche Multi vs. Strategic Allocation Aggressive | Deutsche Multi vs. Value Fund Investor | Deutsche Multi vs. International Growth Fund |
| State Street vs. Qs Moderate Growth | State Street vs. Jp Morgan Smartretirement | State Street vs. Wilmington Trust Retirement | State Street vs. Deutsche Multi Asset Moderate |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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