Correlation Between Marathon Petroleum and Ampol
Can any of the company-specific risk be diversified away by investing in both Marathon Petroleum and Ampol 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 Marathon Petroleum and Ampol into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Marathon Petroleum Corp and Ampol Limited, you can compare the effects of market volatilities on Marathon Petroleum and Ampol 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 Marathon Petroleum with a short position of Ampol. Check out your portfolio center. Please also check ongoing floating volatility patterns of Marathon Petroleum and Ampol.
Diversification Opportunities for Marathon Petroleum and Ampol
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Marathon and Ampol is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Marathon Petroleum Corp and Ampol Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ampol Limited and Marathon Petroleum 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 Marathon Petroleum Corp are associated (or correlated) with Ampol. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ampol Limited has no effect on the direction of Marathon Petroleum i.e., Marathon Petroleum and Ampol go up and down completely randomly.
Pair Corralation between Marathon Petroleum and Ampol
If you would invest 15,020 in Marathon Petroleum Corp on August 27, 2024 and sell it today you would earn a total of 630.00 from holding Marathon Petroleum Corp or generate 4.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 4.76% |
| Values | Daily Returns |
Marathon Petroleum Corp vs. Ampol Limited
Performance |
| Timeline |
| Marathon Petroleum Corp |
| Ampol Limited |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Marathon Petroleum and Ampol Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Marathon Petroleum and Ampol
The main advantage of trading using opposite Marathon Petroleum and Ampol positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Marathon Petroleum position performs unexpectedly, Ampol 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 Ampol will offset losses from the drop in Ampol's long position.| Marathon Petroleum vs. Phillips 66 | Marathon Petroleum vs. HF Sinclair Corp | Marathon Petroleum vs. PBF Energy | Marathon Petroleum vs. Sunoco LP |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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