Correlation Between Marine Products and SunOpta
Can any of the company-specific risk be diversified away by investing in both Marine Products and SunOpta 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 SunOpta into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Marine Products and SunOpta, you can compare the effects of market volatilities on Marine Products and SunOpta 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 SunOpta. Check out your portfolio center. Please also check ongoing floating volatility patterns of Marine Products and SunOpta.
Diversification Opportunities for Marine Products and SunOpta
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Marine and SunOpta is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Marine Products and SunOpta in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SunOpta 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 SunOpta. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SunOpta has no effect on the direction of Marine Products i.e., Marine Products and SunOpta go up and down completely randomly.
Pair Corralation between Marine Products and SunOpta
Considering the 90-day investment horizon Marine Products is expected to generate 2.22 times less return on investment than SunOpta. But when comparing it to its historical volatility, Marine Products is 1.26 times less risky than SunOpta. It trades about 0.18 of its potential returns per unit of risk. SunOpta is currently generating about 0.32 of returns per unit of risk over similar time horizon. If you would invest 675.00 in SunOpta on September 3, 2024 and sell it today you would earn a total of 100.00 from holding SunOpta or generate 14.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Marine Products vs. SunOpta
Performance |
| Timeline |
| Marine Products |
| SunOpta |
Marine Products and SunOpta Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Marine Products and SunOpta
The main advantage of trading using opposite Marine Products and SunOpta positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Marine Products position performs unexpectedly, SunOpta 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 SunOpta will offset losses from the drop in SunOpta's long position.| Marine Products vs. BRP Inc | Marine Products vs. Brunswick | Marine Products vs. EZGO Technologies | Marine Products vs. SCOR PK |
| SunOpta vs. Seneca Foods Corp | SunOpta vs. Central Garden Pet | SunOpta vs. Central Garden Pet | SunOpta vs. Natures Sunshine Products |
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.
Other Complementary Tools
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes |