Correlation Between American Axle and Marine Bancorp
Can any of the company-specific risk be diversified away by investing in both American Axle and Marine Bancorp 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 American Axle and Marine Bancorp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Axle Manufacturing and Marine Bancorp of, you can compare the effects of market volatilities on American Axle and Marine Bancorp 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 American Axle with a short position of Marine Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Axle and Marine Bancorp.
Diversification Opportunities for American Axle and Marine Bancorp
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between American and Marine is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding American Axle Manufacturing and Marine Bancorp of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marine Bancorp and American Axle 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 American Axle Manufacturing are associated (or correlated) with Marine Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marine Bancorp has no effect on the direction of American Axle i.e., American Axle and Marine Bancorp go up and down completely randomly.
Pair Corralation between American Axle and Marine Bancorp
Considering the 90-day investment horizon American Axle Manufacturing is expected to generate 7.61 times more return on investment than Marine Bancorp. However, American Axle is 7.61 times more volatile than Marine Bancorp of. It trades about 0.06 of its potential returns per unit of risk. Marine Bancorp of is currently generating about 0.02 per unit of risk. If you would invest 575.00 in American Axle Manufacturing on October 22, 2024 and sell it today you would earn a total of 14.00 from holding American Axle Manufacturing or generate 2.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 94.74% |
| Values | Daily Returns |
American Axle Manufacturing vs. Marine Bancorp of
Performance |
| Timeline |
| American Axle Manufa |
| Marine Bancorp |
American Axle and Marine Bancorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Axle and Marine Bancorp
The main advantage of trading using opposite American Axle and Marine Bancorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Axle position performs unexpectedly, Marine Bancorp 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 Marine Bancorp will offset losses from the drop in Marine Bancorp's long position.| American Axle vs. Lear Corporation | American Axle vs. Commercial Vehicle Group | American Axle vs. Adient PLC | American Axle vs. Gentex |
| Marine Bancorp vs. National Beverage Corp | Marine Bancorp vs. Vodka Brands Corp | Marine Bancorp vs. Pinterest | Marine Bancorp vs. Asure Software |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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