Correlation Between Solo Brands and Marine Products
Can any of the company-specific risk be diversified away by investing in both Solo Brands 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 Solo Brands and Marine Products into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Solo Brands and Marine Products, you can compare the effects of market volatilities on Solo Brands 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 Solo Brands with a short position of Marine Products. Check out your portfolio center. Please also check ongoing floating volatility patterns of Solo Brands and Marine Products.
Diversification Opportunities for Solo Brands and Marine Products
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Solo and Marine is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Solo Brands and Marine Products in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marine Products and Solo Brands 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 Solo Brands 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 Solo Brands i.e., Solo Brands and Marine Products go up and down completely randomly.
Pair Corralation between Solo Brands and Marine Products
Considering the 90-day investment horizon Solo Brands is expected to generate 1.08 times less return on investment than Marine Products. In addition to that, Solo Brands is 2.99 times more volatile than Marine Products. It trades about 0.06 of its total potential returns per unit of risk. Marine Products is currently generating about 0.18 per unit of volatility. If you would invest 937.00 in Marine Products on August 29, 2024 and sell it today you would earn a total of 64.00 from holding Marine Products or generate 6.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Solo Brands vs. Marine Products
Performance |
| Timeline |
| Solo Brands |
| Marine Products |
Solo Brands and Marine Products Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Solo Brands and Marine Products
The main advantage of trading using opposite Solo Brands and Marine Products positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Solo Brands 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.| Solo Brands vs. Funko Inc | Solo Brands vs. JAKKS Pacific | Solo Brands vs. Madison Square Garden | Solo Brands vs. Life Time Group |
| Marine Products vs. Thor Industries | Marine Products vs. BRP Inc | Marine Products vs. Brunswick | Marine Products vs. EZGO Technologies |
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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