Correlation Between Marine Products and Fenbo Holdings
Can any of the company-specific risk be diversified away by investing in both Marine Products and Fenbo Holdings 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 Marine Products and Fenbo Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Marine Products and Fenbo Holdings Limited, you can compare the effects of market volatilities on Marine Products and Fenbo Holdings 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 Marine Products with a short position of Fenbo Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Marine Products and Fenbo Holdings.
Diversification Opportunities for Marine Products and Fenbo Holdings
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Marine and Fenbo is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Marine Products and Fenbo Holdings Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fenbo Holdings and Marine Products 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 Marine Products are associated (or correlated) with Fenbo Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fenbo Holdings has no effect on the direction of Marine Products i.e., Marine Products and Fenbo Holdings go up and down completely randomly.
Pair Corralation between Marine Products and Fenbo Holdings
Considering the 90-day investment horizon Marine Products is expected to generate 0.94 times more return on investment than Fenbo Holdings. However, Marine Products is 1.07 times less risky than Fenbo Holdings. It trades about -0.01 of its potential returns per unit of risk. Fenbo Holdings Limited is currently generating about -0.39 per unit of risk. If you would invest 901.00 in Marine Products on November 18, 2024 and sell it today you would lose (12.00) from holding Marine Products or give up 1.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Marine Products vs. Fenbo Holdings Limited
Performance |
| Timeline |
| Marine Products |
| Fenbo Holdings |
Marine Products and Fenbo Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Marine Products and Fenbo Holdings
The main advantage of trading using opposite Marine Products and Fenbo Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Marine Products position performs unexpectedly, Fenbo Holdings 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 Fenbo Holdings will offset losses from the drop in Fenbo Holdings' long position.| Marine Products vs. Thor Industries | Marine Products vs. BRP Inc | Marine Products vs. Brunswick | Marine Products vs. EZGO Technologies |
| Fenbo Holdings vs. CDW Corp | Fenbo Holdings vs. RBC Bearings Incorporated | Fenbo Holdings vs. The Gap, | Fenbo Holdings vs. Coupang LLC |
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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