Correlation Between Deutsche Bank and CNFinance Holdings
Can any of the company-specific risk be diversified away by investing in both Deutsche Bank and CNFinance Holdings 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 CNFinance Holdings 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 CNFinance Holdings, you can compare the effects of market volatilities on Deutsche Bank and CNFinance Holdings 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 CNFinance Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Deutsche Bank and CNFinance Holdings.
Diversification Opportunities for Deutsche Bank and CNFinance Holdings
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Deutsche and CNFinance is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Deutsche Bank AG and CNFinance Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CNFinance Holdings 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 CNFinance Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CNFinance Holdings has no effect on the direction of Deutsche Bank i.e., Deutsche Bank and CNFinance Holdings go up and down completely randomly.
Pair Corralation between Deutsche Bank and CNFinance Holdings
Allowing for the 90-day total investment horizon Deutsche Bank AG is expected to generate 0.48 times more return on investment than CNFinance Holdings. However, Deutsche Bank AG is 2.1 times less risky than CNFinance Holdings. It trades about 0.14 of its potential returns per unit of risk. CNFinance Holdings is currently generating about -0.07 per unit of risk. If you would invest 2,336 in Deutsche Bank AG on March 28, 2025 and sell it today you would earn a total of 592.00 from holding Deutsche Bank AG or generate 25.34% 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. CNFinance Holdings
Performance |
| Timeline |
| Deutsche Bank AG |
| CNFinance Holdings |
Deutsche Bank and CNFinance Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Deutsche Bank and CNFinance Holdings
The main advantage of trading using opposite Deutsche Bank and CNFinance Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Deutsche Bank position performs unexpectedly, CNFinance Holdings 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 CNFinance Holdings will offset losses from the drop in CNFinance Holdings' 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 |
| CNFinance Holdings vs. Guild Holdings Co | CNFinance Holdings vs. PennyMac Finl Svcs | CNFinance Holdings vs. Security National Financial | CNFinance Holdings vs. Encore Capital Group |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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