Correlation Between ACG Acquisition and Martin Marietta
Can any of the company-specific risk be diversified away by investing in both ACG Acquisition and Martin Marietta 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 ACG Acquisition and Martin Marietta into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ACG Acquisition Co and Martin Marietta Materials, you can compare the effects of market volatilities on ACG Acquisition and Martin Marietta 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 ACG Acquisition with a short position of Martin Marietta. Check out your portfolio center. Please also check ongoing floating volatility patterns of ACG Acquisition and Martin Marietta.
Diversification Opportunities for ACG Acquisition and Martin Marietta
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between ACG and Martin is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding ACG Acquisition Co and Martin Marietta Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Martin Marietta Materials and ACG Acquisition 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 ACG Acquisition Co are associated (or correlated) with Martin Marietta. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Martin Marietta Materials has no effect on the direction of ACG Acquisition i.e., ACG Acquisition and Martin Marietta go up and down completely randomly.
Pair Corralation between ACG Acquisition and Martin Marietta
If you would invest 52,818 in Martin Marietta Materials on October 24, 2024 and sell it today you would earn a total of 2,519 from holding Martin Marietta Materials or generate 4.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 73.68% |
| Values | Daily Returns |
ACG Acquisition Co vs. Martin Marietta Materials
Performance |
| Timeline |
| ACG Acquisition |
| Martin Marietta Materials |
ACG Acquisition and Martin Marietta Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ACG Acquisition and Martin Marietta
The main advantage of trading using opposite ACG Acquisition and Martin Marietta positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ACG Acquisition position performs unexpectedly, Martin Marietta 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 Martin Marietta will offset losses from the drop in Martin Marietta's long position.| ACG Acquisition vs. Amedeo Air Four | ACG Acquisition vs. Finnair Oyj | ACG Acquisition vs. Empire Metals Limited | ACG Acquisition vs. Sealed Air Corp |
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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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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