Correlation Between Boston Omaha and Marine Products
Can any of the company-specific risk be diversified away by investing in both Boston Omaha and Marine Products 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 Boston Omaha and Marine Products into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Boston Omaha Corp and Marine Products, you can compare the effects of market volatilities on Boston Omaha and Marine Products 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 Boston Omaha with a short position of Marine Products. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boston Omaha and Marine Products.
Diversification Opportunities for Boston Omaha and Marine Products
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Boston and Marine is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Boston Omaha Corp and Marine Products in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marine Products and Boston Omaha 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 Boston Omaha Corp are associated (or correlated) with Marine Products. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marine Products has no effect on the direction of Boston Omaha i.e., Boston Omaha and Marine Products go up and down completely randomly.
Pair Corralation between Boston Omaha and Marine Products
Considering the 90-day investment horizon Boston Omaha Corp is expected to under-perform the Marine Products. But the stock apears to be less risky and, when comparing its historical volatility, Boston Omaha Corp is 1.33 times less risky than Marine Products. The stock trades about -0.05 of its potential returns per unit of risk. The Marine Products is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 939.00 in Marine Products on August 26, 2024 and sell it today you would earn a total of 45.00 from holding Marine Products or generate 4.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Boston Omaha Corp vs. Marine Products
Performance |
| Timeline |
| Boston Omaha Corp |
| Marine Products |
Boston Omaha and Marine Products Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boston Omaha and Marine Products
The main advantage of trading using opposite Boston Omaha and Marine Products positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boston Omaha position performs unexpectedly, Marine Products 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 Products will offset losses from the drop in Marine Products' long position.| Boston Omaha vs. Integral Ad Science | Boston Omaha vs. Cardlytics | Boston Omaha vs. Cimpress NV | Boston Omaha vs. QuinStreet |
| Marine Products vs. MCBC Holdings | Marine Products vs. Winnebago Industries | Marine Products vs. LCI Industries | Marine Products vs. Thor Industries |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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