Correlation Between Marlowe Plc and Securitas
Can any of the company-specific risk be diversified away by investing in both Marlowe Plc and Securitas 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 Marlowe Plc and Securitas into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Marlowe plc and Securitas AB, you can compare the effects of market volatilities on Marlowe Plc and Securitas 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 Marlowe Plc with a short position of Securitas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Marlowe Plc and Securitas.
Diversification Opportunities for Marlowe Plc and Securitas
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Marlowe and Securitas is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Marlowe plc and Securitas AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Securitas AB and Marlowe Plc 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 Marlowe plc are associated (or correlated) with Securitas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Securitas AB has no effect on the direction of Marlowe Plc i.e., Marlowe Plc and Securitas go up and down completely randomly.
Pair Corralation between Marlowe Plc and Securitas
Assuming the 90 days horizon Marlowe Plc is expected to generate 1.25 times less return on investment than Securitas. In addition to that, Marlowe Plc is 3.48 times more volatile than Securitas AB. It trades about 0.02 of its total potential returns per unit of risk. Securitas AB is currently generating about 0.08 per unit of volatility. If you would invest 7,904 in Securitas AB on August 30, 2024 and sell it today you would earn a total of 5,716 from holding Securitas AB or generate 72.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.6% |
| Values | Daily Returns |
Marlowe plc vs. Securitas AB
Performance |
| Timeline |
| Marlowe plc |
| Securitas AB |
Marlowe Plc and Securitas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Marlowe Plc and Securitas
The main advantage of trading using opposite Marlowe Plc and Securitas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Marlowe Plc position performs unexpectedly, Securitas 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 Securitas will offset losses from the drop in Securitas' long position.| Marlowe Plc vs. YourWay Cannabis Brands | Marlowe Plc vs. HUMANA INC | Marlowe Plc vs. Aquagold International | Marlowe Plc vs. Barloworld Ltd ADR |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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