Correlation Between Martin Marietta and Deutsche Bank
Can any of the company-specific risk be diversified away by investing in both Martin Marietta and Deutsche Bank 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 Martin Marietta and Deutsche Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Martin Marietta Materials and Deutsche Bank Aktiengesellschaft, you can compare the effects of market volatilities on Martin Marietta and Deutsche Bank 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 Martin Marietta with a short position of Deutsche Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Martin Marietta and Deutsche Bank.
Diversification Opportunities for Martin Marietta and Deutsche Bank
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Martin and Deutsche is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Martin Marietta Materials and Deutsche Bank Aktiengesellscha in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Deutsche Bank Aktien and Martin Marietta 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 Martin Marietta Materials are associated (or correlated) with Deutsche Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Deutsche Bank Aktien has no effect on the direction of Martin Marietta i.e., Martin Marietta and Deutsche Bank go up and down completely randomly.
Pair Corralation between Martin Marietta and Deutsche Bank
Assuming the 90 days trading horizon Martin Marietta is expected to generate 6.01 times less return on investment than Deutsche Bank. But when comparing it to its historical volatility, Martin Marietta Materials is 1.1 times less risky than Deutsche Bank. It trades about 0.01 of its potential returns per unit of risk. Deutsche Bank Aktiengesellschaft is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 33,852 in Deutsche Bank Aktiengesellschaft on August 31, 2024 and sell it today you would earn a total of 352.00 from holding Deutsche Bank Aktiengesellschaft or generate 1.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Martin Marietta Materials vs. Deutsche Bank Aktiengesellscha
Performance |
| Timeline |
| Martin Marietta Materials |
| Deutsche Bank Aktien |
Martin Marietta and Deutsche Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Martin Marietta and Deutsche Bank
The main advantage of trading using opposite Martin Marietta and Deutsche Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Martin Marietta position performs unexpectedly, Deutsche Bank 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 Bank will offset losses from the drop in Deutsche Bank's long position.| Martin Marietta vs. TopBuild Corp | Martin Marietta vs. CEMEX SAB de | Martin Marietta vs. Grupo Cementos de | Martin Marietta vs. Grupo Lamosa SAB |
| Deutsche Bank vs. Verizon Communications | Deutsche Bank vs. Lloyds Banking Group | Deutsche Bank vs. Micron Technology | Deutsche Bank vs. Applied Materials |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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