Correlation Between Marten Transport and TFI International
Can any of the company-specific risk be diversified away by investing in both Marten Transport and TFI International 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 Marten Transport and TFI International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Marten Transport and TFI International, you can compare the effects of market volatilities on Marten Transport and TFI International 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 Marten Transport with a short position of TFI International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Marten Transport and TFI International.
Diversification Opportunities for Marten Transport and TFI International
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Marten and TFI is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Marten Transport and TFI International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TFI International and Marten Transport 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 Marten Transport are associated (or correlated) with TFI International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TFI International has no effect on the direction of Marten Transport i.e., Marten Transport and TFI International go up and down completely randomly.
Pair Corralation between Marten Transport and TFI International
Given the investment horizon of 90 days Marten Transport is expected to generate 1.48 times less return on investment than TFI International. But when comparing it to its historical volatility, Marten Transport is 1.0 times less risky than TFI International. It trades about 0.14 of its potential returns per unit of risk. TFI International is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 13,382 in TFI International on August 26, 2024 and sell it today you would earn a total of 1,491 from holding TFI International or generate 11.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Marten Transport vs. TFI International
Performance |
| Timeline |
| Marten Transport |
| TFI International |
Marten Transport and TFI International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Marten Transport and TFI International
The main advantage of trading using opposite Marten Transport and TFI International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Marten Transport position performs unexpectedly, TFI International 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 TFI International will offset losses from the drop in TFI International's long position.| Marten Transport vs. Werner Enterprises | Marten Transport vs. Covenant Logistics Group, | Marten Transport vs. Universal Logistics Holdings | Marten Transport vs. Schneider National |
| TFI International vs. Old Dominion Freight | TFI International vs. ArcBest Corp | TFI International vs. Knight Transportation | TFI International vs. Universal Logistics Holdings |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
Other Complementary Tools
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. |