Correlation Between Deutsche Bank and Investar Holding
Can any of the company-specific risk be diversified away by investing in both Deutsche Bank and Investar Holding 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 Investar Holding 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 Investar Holding Corp, you can compare the effects of market volatilities on Deutsche Bank and Investar Holding 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 Investar Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Deutsche Bank and Investar Holding.
Diversification Opportunities for Deutsche Bank and Investar Holding
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Deutsche and Investar is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Deutsche Bank AG and Investar Holding Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Investar Holding Corp 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 Investar Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Investar Holding Corp has no effect on the direction of Deutsche Bank i.e., Deutsche Bank and Investar Holding go up and down completely randomly.
Pair Corralation between Deutsche Bank and Investar Holding
Allowing for the 90-day total investment horizon Deutsche Bank AG is expected to generate 0.81 times more return on investment than Investar Holding. However, Deutsche Bank AG is 1.24 times less risky than Investar Holding. It trades about 0.4 of its potential returns per unit of risk. Investar Holding Corp is currently generating about -0.25 per unit of risk. If you would invest 1,716 in Deutsche Bank AG on November 3, 2024 and sell it today you would earn a total of 237.00 from holding Deutsche Bank AG or generate 13.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Deutsche Bank AG vs. Investar Holding Corp
Performance |
| Timeline |
| Deutsche Bank AG |
| Investar Holding Corp |
Deutsche Bank and Investar Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Deutsche Bank and Investar Holding
The main advantage of trading using opposite Deutsche Bank and Investar Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Deutsche Bank position performs unexpectedly, Investar Holding 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 Investar Holding will offset losses from the drop in Investar Holding's 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 |
| Investar Holding vs. Magyar Bancorp | Investar Holding vs. Home Federal Bancorp | Investar Holding vs. Community West Bancshares | Investar Holding vs. First Northwest Bancorp |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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