Correlation Between Vanguard Growth and Deutsche Bank
Can any of the company-specific risk be diversified away by investing in both Vanguard Growth and Deutsche Bank 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 Vanguard Growth and Deutsche Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vanguard Growth Index and Deutsche Bank AG, you can compare the effects of market volatilities on Vanguard Growth and Deutsche Bank 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 Vanguard Growth with a short position of Deutsche Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vanguard Growth and Deutsche Bank.
Diversification Opportunities for Vanguard Growth and Deutsche Bank
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Vanguard and Deutsche is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Vanguard Growth Index and Deutsche Bank AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Deutsche Bank AG and Vanguard Growth 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 Vanguard Growth Index are associated (or correlated) with Deutsche Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Deutsche Bank AG has no effect on the direction of Vanguard Growth i.e., Vanguard Growth and Deutsche Bank go up and down completely randomly.
Pair Corralation between Vanguard Growth and Deutsche Bank
Assuming the 90 days horizon Vanguard Growth Index is expected to under-perform the Deutsche Bank. But the mutual fund apears to be less risky and, when comparing its historical volatility, Vanguard Growth Index is 1.81 times less risky than Deutsche Bank. The mutual fund trades about -0.28 of its potential returns per unit of risk. The Deutsche Bank AG is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 1,499 in Deutsche Bank AG on January 20, 2024 and sell it today you would earn a total of 81.00 from holding Deutsche Bank AG or generate 5.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Vanguard Growth Index vs. Deutsche Bank AG
Performance |
| Timeline |
| Vanguard Growth Index |
| Deutsche Bank AG |
Vanguard Growth and Deutsche Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vanguard Growth and Deutsche Bank
The main advantage of trading using opposite Vanguard Growth and Deutsche Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vanguard Growth position performs unexpectedly, Deutsche Bank 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 Bank will offset losses from the drop in Deutsche Bank's long position.| Vanguard Growth vs. Vanguard Value Index | Vanguard Growth vs. Vanguard Mid Cap Index | Vanguard Growth vs. Vanguard Small Cap Growth | Vanguard Growth vs. Vanguard 500 Index |
| Deutsche Bank vs. Banco Bradesco SA | Deutsche Bank vs. Itau Unibanco Banco | Deutsche Bank vs. Lloyds Banking Group | Deutsche Bank vs. Banco Santander Brasil |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world |