Correlation Between Deutsche Bank and Axos Financial
Can any of the company-specific risk be diversified away by investing in both Deutsche Bank and Axos 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 Bank and Axos Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Deutsche Bank AG and Axos Financial, you can compare the effects of market volatilities on Deutsche Bank and Axos 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 Bank with a short position of Axos Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Deutsche Bank and Axos Financial.
Diversification Opportunities for Deutsche Bank and Axos Financial
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Deutsche and Axos is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Deutsche Bank AG and Axos Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Axos Financial and Deutsche Bank 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 Bank AG are associated (or correlated) with Axos Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Axos Financial has no effect on the direction of Deutsche Bank i.e., Deutsche Bank and Axos Financial go up and down completely randomly.
Pair Corralation between Deutsche Bank and Axos Financial
Allowing for the 90-day total investment horizon Deutsche Bank AG is expected to generate 0.79 times more return on investment than Axos Financial. However, Deutsche Bank AG is 1.27 times less risky than Axos Financial. It trades about 0.06 of its potential returns per unit of risk. Axos Financial is currently generating about 0.03 per unit of risk. If you would invest 957.00 in Deutsche Bank AG on January 20, 2024 and sell it today you would earn a total of 634.00 from holding Deutsche Bank AG or generate 66.25% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Deutsche Bank AG vs. Axos Financial
Performance |
Timeline |
Deutsche Bank AG |
Axos Financial |
Deutsche Bank and Axos Financial Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Deutsche Bank and Axos Financial
The main advantage of trading using opposite Deutsche Bank and Axos Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Deutsche Bank position performs unexpectedly, Axos 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 Axos Financial will offset losses from the drop in Axos Financial's long position.Deutsche Bank vs. Banco Bradesco SA | Deutsche Bank vs. Itau Unibanco Banco | Deutsche Bank vs. Lloyds Banking Group | Deutsche Bank vs. Banco Santander Brasil |
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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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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