Correlation Between MarineMax and Winmark
Can any of the company-specific risk be diversified away by investing in both MarineMax and Winmark 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 MarineMax and Winmark into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MarineMax and Winmark, you can compare the effects of market volatilities on MarineMax and Winmark 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 MarineMax with a short position of Winmark. Check out your portfolio center. Please also check ongoing floating volatility patterns of MarineMax and Winmark.
Diversification Opportunities for MarineMax and Winmark
Good diversification
The 3 months correlation between MarineMax and Winmark is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding MarineMax and Winmark in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Winmark and MarineMax 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 MarineMax are associated (or correlated) with Winmark. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Winmark has no effect on the direction of MarineMax i.e., MarineMax and Winmark go up and down completely randomly.
Pair Corralation between MarineMax and Winmark
Considering the 90-day investment horizon MarineMax is expected to generate 1.48 times less return on investment than Winmark. In addition to that, MarineMax is 1.85 times more volatile than Winmark. It trades about 0.08 of its total potential returns per unit of risk. Winmark is currently generating about 0.21 per unit of volatility. If you would invest 37,187 in Winmark on August 24, 2024 and sell it today you would earn a total of 3,338 from holding Winmark or generate 8.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
MarineMax vs. Winmark
Performance |
| Timeline |
| MarineMax |
| Winmark |
MarineMax and Winmark Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MarineMax and Winmark
The main advantage of trading using opposite MarineMax and Winmark positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MarineMax position performs unexpectedly, Winmark 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 Winmark will offset losses from the drop in Winmark's long position.| MarineMax vs. National Vision Holdings | MarineMax vs. Sally Beauty Holdings | MarineMax vs. Sportsmans | MarineMax vs. 1 800 FLOWERSCOM |
| Winmark vs. Mesa Laboratories | Winmark vs. Utah Medical Products | Winmark vs. Weyco Group | Winmark vs. Diamond Hill Investment |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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