Correlation Between Deutsche Post and Landstar System
Can any of the company-specific risk be diversified away by investing in both Deutsche Post and Landstar System 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 Post and Landstar System into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Deutsche Post AG and Landstar System, you can compare the effects of market volatilities on Deutsche Post and Landstar System 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 Post with a short position of Landstar System. Check out your portfolio center. Please also check ongoing floating volatility patterns of Deutsche Post and Landstar System.
Diversification Opportunities for Deutsche Post and Landstar System
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Deutsche and Landstar is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Deutsche Post AG and Landstar System in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Landstar System and Deutsche Post 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 Post AG are associated (or correlated) with Landstar System. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Landstar System has no effect on the direction of Deutsche Post i.e., Deutsche Post and Landstar System go up and down completely randomly.
Pair Corralation between Deutsche Post and Landstar System
Assuming the 90 days horizon Deutsche Post AG is expected to generate 1.07 times more return on investment than Landstar System. However, Deutsche Post is 1.07 times more volatile than Landstar System. It trades about 0.16 of its potential returns per unit of risk. Landstar System is currently generating about 0.03 per unit of risk. If you would invest 3,801 in Deutsche Post AG on August 28, 2024 and sell it today you would earn a total of 1,362 from holding Deutsche Post AG or generate 35.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 28.57% |
| Values | Daily Returns |
Deutsche Post AG vs. Landstar System
Performance |
| Timeline |
| Deutsche Post AG |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Landstar System |
Deutsche Post and Landstar System Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Deutsche Post and Landstar System
The main advantage of trading using opposite Deutsche Post and Landstar System positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Deutsche Post position performs unexpectedly, Landstar System 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 Landstar System will offset losses from the drop in Landstar System's long position.| Deutsche Post vs. DSV Panalpina AS | Deutsche Post vs. FedEx | Deutsche Post vs. United Parcel Service | Deutsche Post vs. Kuehne Nagel International |
| Landstar System vs. Hub Group | Landstar System vs. JB Hunt Transport | Landstar System vs. Expeditors International of | Landstar System vs. CH Robinson Worldwide |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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