Correlation Between Eastern and Deutsche Lufthansa
Can any of the company-specific risk be diversified away by investing in both Eastern and Deutsche Lufthansa 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 Eastern and Deutsche Lufthansa into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eastern Co and Deutsche Lufthansa AG, you can compare the effects of market volatilities on Eastern and Deutsche Lufthansa 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 Eastern with a short position of Deutsche Lufthansa. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eastern and Deutsche Lufthansa.
Diversification Opportunities for Eastern and Deutsche Lufthansa
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Eastern and Deutsche is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Eastern Co and Deutsche Lufthansa AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Deutsche Lufthansa and Eastern 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 Eastern Co are associated (or correlated) with Deutsche Lufthansa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Deutsche Lufthansa has no effect on the direction of Eastern i.e., Eastern and Deutsche Lufthansa go up and down completely randomly.
Pair Corralation between Eastern and Deutsche Lufthansa
If you would invest 1,741 in Eastern Co on September 12, 2024 and sell it today you would earn a total of 1,259 from holding Eastern Co or generate 72.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Eastern Co vs. Deutsche Lufthansa AG
Performance |
| Timeline |
| Eastern |
| Deutsche Lufthansa |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Eastern and Deutsche Lufthansa Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eastern and Deutsche Lufthansa
The main advantage of trading using opposite Eastern and Deutsche Lufthansa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eastern position performs unexpectedly, Deutsche Lufthansa 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 Deutsche Lufthansa will offset losses from the drop in Deutsche Lufthansa's long position.| Eastern vs. Timken Company | Eastern vs. Lincoln Electric Holdings | Eastern vs. Hillman Solutions Corp | Eastern vs. AB SKF |
| Deutsche Lufthansa vs. Evertz Technologies Limited | Deutsche Lufthansa vs. Asure Software | Deutsche Lufthansa vs. Nuvalent | Deutsche Lufthansa vs. Lipocine |
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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