Correlation Between DEUTSCHE GLOBAL and SPDR Portfolio

Can any of the company-specific risk be diversified away by investing in both DEUTSCHE GLOBAL and SPDR Portfolio 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 GLOBAL and SPDR Portfolio into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between DEUTSCHE GLOBAL INFLATION and SPDR Portfolio TIPS, you can compare the effects of market volatilities on DEUTSCHE GLOBAL and SPDR Portfolio 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 GLOBAL with a short position of SPDR Portfolio. Check out your portfolio center. Please also check ongoing floating volatility patterns of DEUTSCHE GLOBAL and SPDR Portfolio.

Diversification Opportunities for DEUTSCHE GLOBAL and SPDR Portfolio

1.0

Correlation Coefficient

DEUTSCHE GLOBAL  SPDR Portfolio

No risk reduction

The 3 months correlation between DEUTSCHE and SPDR is 1.0. Overlapping area represents the amount of risk that can be diversified away by holding DEUTSCHE GLOBAL INFLATION and SPDR Portfolio TIPS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPDR Portfolio TIPS and DEUTSCHE GLOBAL 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 GLOBAL INFLATION are associated (or correlated) with SPDR Portfolio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPDR Portfolio TIPS has no effect on the direction of DEUTSCHE GLOBAL i.e., DEUTSCHE GLOBAL and SPDR Portfolio go up and down completely randomly.

Pair Corralation between DEUTSCHE GLOBAL and SPDR Portfolio

Assuming the 90 days horizon DEUTSCHE GLOBAL INFLATION is expected to generate 0.91 times more return on investment than SPDR Portfolio. However, DEUTSCHE GLOBAL INFLATION is 1.1 times less risky than SPDR Portfolio. It trades about 0.12 of its potential returns per unit of risk. SPDR Portfolio TIPS is currently generating about 0.1 per unit of risk. If you would invest  949.00  in DEUTSCHE GLOBAL INFLATION on May 4, 2025 and sell it today you would earn a total of  17.00  from holding DEUTSCHE GLOBAL INFLATION or generate 1.79% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	100.0%
Values	Daily Returns

DEUTSCHE GLOBAL INFLATION  vs.  SPDR Portfolio TIPS

DEUTSCHE GLOBAL INFLATION

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in DEUTSCHE GLOBAL INFLATION are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong basic indicators, DEUTSCHE GLOBAL is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

SPDR Portfolio TIPS

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in SPDR Portfolio TIPS are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable forward indicators, SPDR Portfolio is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with DEUTSCHE GLOBAL and SPDR Portfolio

The main advantage of trading using opposite DEUTSCHE GLOBAL and SPDR Portfolio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DEUTSCHE GLOBAL position performs unexpectedly, SPDR Portfolio 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 SPDR Portfolio will offset losses from the drop in SPDR Portfolio's long position.

The idea behind DEUTSCHE GLOBAL INFLATION and SPDR Portfolio TIPS pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Equity Valuation module to check real value of public entities based on technical and fundamental data.