Correlation Between DEUTSCHE and American Airlines
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By analyzing existing cross correlation between DEUTSCHE BANK AG and American Airlines Group, you can compare the effects of market volatilities on DEUTSCHE and American Airlines 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 with a short position of American Airlines. Check out your portfolio center. Please also check ongoing floating volatility patterns of DEUTSCHE and American Airlines.
Diversification Opportunities for DEUTSCHE and American Airlines
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between DEUTSCHE and American is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding DEUTSCHE BANK AG and American Airlines Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Airlines and DEUTSCHE 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 American Airlines. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Airlines has no effect on the direction of DEUTSCHE i.e., DEUTSCHE and American Airlines go up and down completely randomly.
Pair Corralation between DEUTSCHE and American Airlines
Assuming the 90 days trading horizon DEUTSCHE is expected to generate 8.72 times less return on investment than American Airlines. But when comparing it to its historical volatility, DEUTSCHE BANK AG is 17.08 times less risky than American Airlines. It trades about 0.11 of its potential returns per unit of risk. American Airlines Group is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 1,382 in American Airlines Group on October 14, 2024 and sell it today you would earn a total of 456.00 from holding American Airlines Group or generate 33.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 78.63% |
| Values | Daily Returns |
DEUTSCHE BANK AG vs. American Airlines Group
Performance |
| Timeline |
| DEUTSCHE BANK AG |
| American Airlines |
DEUTSCHE and American Airlines Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DEUTSCHE and American Airlines
The main advantage of trading using opposite DEUTSCHE and American Airlines positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DEUTSCHE position performs unexpectedly, American Airlines 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 American Airlines will offset losses from the drop in American Airlines' long position.| DEUTSCHE vs. Hudson Technologies | DEUTSCHE vs. American Airlines Group | DEUTSCHE vs. Hawkins | DEUTSCHE vs. International Consolidated Airlines |
| American Airlines vs. Southwest Airlines | American Airlines vs. JetBlue Airways Corp | American Airlines vs. United Airlines Holdings | American Airlines vs. Frontier Group Holdings |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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