Correlation Between Dws Equity and Us Government
Can any of the company-specific risk be diversified away by investing in both Dws Equity and Us Government 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 Dws Equity and Us Government into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dws Equity Sector and Us Government Securities, you can compare the effects of market volatilities on Dws Equity and Us Government 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 Dws Equity with a short position of Us Government. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dws Equity and Us Government.
Diversification Opportunities for Dws Equity and Us Government
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Dws and RGVCX is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Dws Equity Sector and Us Government Securities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Us Government Securities and Dws Equity 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 Dws Equity Sector are associated (or correlated) with Us Government. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Us Government Securities has no effect on the direction of Dws Equity i.e., Dws Equity and Us Government go up and down completely randomly.
Pair Corralation between Dws Equity and Us Government
Assuming the 90 days horizon Dws Equity Sector is expected to generate 4.36 times more return on investment than Us Government. However, Dws Equity is 4.36 times more volatile than Us Government Securities. It trades about 0.13 of its potential returns per unit of risk. Us Government Securities is currently generating about 0.11 per unit of risk. If you would invest 2,065 in Dws Equity Sector on September 26, 2025 and sell it today you would earn a total of 129.00 from holding Dws Equity Sector or generate 6.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dws Equity Sector vs. Us Government Securities
Performance |
| Timeline |
| Dws Equity Sector |
| Us Government Securities |
Dws Equity and Us Government Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dws Equity and Us Government
The main advantage of trading using opposite Dws Equity and Us Government positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dws Equity position performs unexpectedly, Us Government 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 Us Government will offset losses from the drop in Us Government's long position.| Dws Equity vs. Deutsche Gnma Fund | Dws Equity vs. Deutsche Short Term Municipal | Dws Equity vs. Deutsche Short Term Municipal | Dws Equity vs. Deutsche Science And |
| Us Government vs. Small Cap Equity | Us Government vs. Dreyfusstandish Global Fixed | Us Government vs. Dws Equity Sector | Us Government vs. Nuveen Core Equity |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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