Correlation Between Marathon Petroleum and AKR Corporindo
Can any of the company-specific risk be diversified away by investing in both Marathon Petroleum and AKR Corporindo 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 AKR Corporindo 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 AKR Corporindo Tbk, you can compare the effects of market volatilities on Marathon Petroleum and AKR Corporindo 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 AKR Corporindo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Marathon Petroleum and AKR Corporindo.
Diversification Opportunities for Marathon Petroleum and AKR Corporindo
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Marathon and AKR is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Marathon Petroleum Corp and AKR Corporindo Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AKR Corporindo Tbk 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 AKR Corporindo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AKR Corporindo Tbk has no effect on the direction of Marathon Petroleum i.e., Marathon Petroleum and AKR Corporindo go up and down completely randomly.
Pair Corralation between Marathon Petroleum and AKR Corporindo
If you would invest 14,464 in Marathon Petroleum Corp on September 1, 2024 and sell it today you would earn a total of 1,151 from holding Marathon Petroleum Corp or generate 7.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Marathon Petroleum Corp vs. AKR Corporindo Tbk
Performance |
| Timeline |
| Marathon Petroleum Corp |
| AKR Corporindo Tbk |
Marathon Petroleum and AKR Corporindo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Marathon Petroleum and AKR Corporindo
The main advantage of trading using opposite Marathon Petroleum and AKR Corporindo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Marathon Petroleum position performs unexpectedly, AKR Corporindo 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 AKR Corporindo will offset losses from the drop in AKR Corporindo'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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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