Correlation Between Marine Products and Fast Retailing
Can any of the company-specific risk be diversified away by investing in both Marine Products and Fast Retailing 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 Fast Retailing into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Marine Products and Fast Retailing Co, you can compare the effects of market volatilities on Marine Products and Fast Retailing 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 Fast Retailing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Marine Products and Fast Retailing.
Diversification Opportunities for Marine Products and Fast Retailing
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Marine and Fast is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Marine Products and Fast Retailing Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fast Retailing 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 Fast Retailing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fast Retailing has no effect on the direction of Marine Products i.e., Marine Products and Fast Retailing go up and down completely randomly.
Pair Corralation between Marine Products and Fast Retailing
Considering the 90-day investment horizon Marine Products is expected to generate 3.47 times less return on investment than Fast Retailing. In addition to that, Marine Products is 1.02 times more volatile than Fast Retailing Co. It trades about 0.02 of its total potential returns per unit of risk. Fast Retailing Co is currently generating about 0.07 per unit of volatility. If you would invest 24,795 in Fast Retailing Co on September 3, 2024 and sell it today you would earn a total of 8,795 from holding Fast Retailing Co or generate 35.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 84.21% |
| Values | Daily Returns |
Marine Products vs. Fast Retailing Co
Performance |
| Timeline |
| Marine Products |
| Fast Retailing |
Marine Products and Fast Retailing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Marine Products and Fast Retailing
The main advantage of trading using opposite Marine Products and Fast Retailing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Marine Products position performs unexpectedly, Fast Retailing 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 Fast Retailing will offset losses from the drop in Fast Retailing's long position.| Marine Products vs. BRP Inc | Marine Products vs. Brunswick | Marine Products vs. EZGO Technologies | Marine Products vs. SCOR PK |
| Fast Retailing vs. Industria de Diseno | Fast Retailing vs. Aritzia | Fast Retailing vs. Shoe Carnival | Fast Retailing vs. Genesco |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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