Correlation Between US Commodity and DWS
Can any of the company-specific risk be diversified away by investing in both US Commodity and DWS 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 US Commodity and DWS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between US Commodity Funds and DWS, you can compare the effects of market volatilities on US Commodity and DWS 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 US Commodity with a short position of DWS. Check out your portfolio center. Please also check ongoing floating volatility patterns of US Commodity and DWS.
Diversification Opportunities for US Commodity and DWS
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between USOU and DWS is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding US Commodity Funds and DWS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DWS and US Commodity 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 US Commodity Funds are associated (or correlated) with DWS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DWS has no effect on the direction of US Commodity i.e., US Commodity and DWS go up and down completely randomly.
Pair Corralation between US Commodity and DWS
If you would invest (100.00) in DWS on January 24, 2024 and sell it today you would earn a total of 100.00 from holding DWS 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 |
US Commodity Funds vs. DWS
Performance |
| Timeline |
| US Commodity Funds |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| DWS |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
US Commodity and DWS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with US Commodity and DWS
The main advantage of trading using opposite US Commodity and DWS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if US Commodity position performs unexpectedly, DWS 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 will offset losses from the drop in DWS's long position.| US Commodity vs. ProShares UltraShort Silver | US Commodity vs. ProShares UltraShort Gold | US Commodity vs. VanEck Junior Gold |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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