Correlation Between Marine Products and UDR
Can any of the company-specific risk be diversified away by investing in both Marine Products and UDR 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 UDR into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Marine Products and UDR Inc, you can compare the effects of market volatilities on Marine Products and UDR 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 UDR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Marine Products and UDR.
Diversification Opportunities for Marine Products and UDR
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Marine and UDR is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Marine Products and UDR Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UDR Inc 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 UDR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UDR Inc has no effect on the direction of Marine Products i.e., Marine Products and UDR go up and down completely randomly.
Pair Corralation between Marine Products and UDR
Considering the 90-day investment horizon Marine Products is expected to generate 2.42 times less return on investment than UDR. In addition to that, Marine Products is 2.09 times more volatile than UDR Inc. It trades about 0.02 of its total potential returns per unit of risk. UDR Inc is currently generating about 0.11 per unit of volatility. If you would invest 3,355 in UDR Inc on September 2, 2024 and sell it today you would earn a total of 1,231 from holding UDR Inc or generate 36.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Marine Products vs. UDR Inc
Performance |
| Timeline |
| Marine Products |
| UDR Inc |
Marine Products and UDR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Marine Products and UDR
The main advantage of trading using opposite Marine Products and UDR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Marine Products position performs unexpectedly, UDR 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 UDR will offset losses from the drop in UDR's long position.| Marine Products vs. LCI Industries | Marine Products vs. MCBC Holdings | Marine Products vs. Winnebago Industries | Marine Products vs. Thor Industries |
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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 Directory module to find actively traded commodities issued by global exchanges.
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