Correlation Between Commerzbank and MAVEN WIRELESS

Can any of the company-specific risk be diversified away by investing in both Commerzbank and MAVEN WIRELESS 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 Commerzbank and MAVEN WIRELESS into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Commerzbank AG and MAVEN WIRELESS SWEDEN, you can compare the effects of market volatilities on Commerzbank and MAVEN WIRELESS 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 Commerzbank with a short position of MAVEN WIRELESS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Commerzbank and MAVEN WIRELESS.

Diversification Opportunities for Commerzbank and MAVEN WIRELESS

-0.43

Correlation Coefficient

Commerzbank  MAVEN WIRELESS

Very good diversification

The 3 months correlation between Commerzbank and MAVEN is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Commerzbank AG and MAVEN WIRELESS SWEDEN in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MAVEN WIRELESS SWEDEN and Commerzbank 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 Commerzbank AG are associated (or correlated) with MAVEN WIRELESS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MAVEN WIRELESS SWEDEN has no effect on the direction of Commerzbank i.e., Commerzbank and MAVEN WIRELESS go up and down completely randomly.

Pair Corralation between Commerzbank and MAVEN WIRELESS

Assuming the 90 days trading horizon Commerzbank AG is expected to generate 0.55 times more return on investment than MAVEN WIRELESS. However, Commerzbank AG is 1.8 times less risky than MAVEN WIRELESS. It trades about 0.33 of its potential returns per unit of risk. MAVEN WIRELESS SWEDEN is currently generating about 0.04 per unit of risk. If you would invest  1,552  in Commerzbank AG on December 25, 2024 and sell it today you would earn a total of  777.00  from holding Commerzbank AG or generate 50.06% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Commerzbank AG  vs.  MAVEN WIRELESS SWEDEN

Commerzbank AG

Risk-Adjusted Performance

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Commerzbank AG are ranked lower than 26 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile forward-looking signals, Commerzbank unveiled solid returns over the last few months and may actually be approaching a breakup point.

MAVEN WIRELESS SWEDEN

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in MAVEN WIRELESS SWEDEN are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, MAVEN WIRELESS may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Commerzbank and MAVEN WIRELESS

The main advantage of trading using opposite Commerzbank and MAVEN WIRELESS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Commerzbank position performs unexpectedly, MAVEN WIRELESS 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 MAVEN WIRELESS will offset losses from the drop in MAVEN WIRELESS's long position.

The idea behind Commerzbank AG and MAVEN WIRELESS SWEDEN pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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.