Correlation Between SBM Offshore and Mannatech Incorporated
Can any of the company-specific risk be diversified away by investing in both SBM Offshore and Mannatech Incorporated 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 SBM Offshore and Mannatech Incorporated into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SBM Offshore NV and Mannatech Incorporated, you can compare the effects of market volatilities on SBM Offshore and Mannatech Incorporated 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 SBM Offshore with a short position of Mannatech Incorporated. Check out your portfolio center. Please also check ongoing floating volatility patterns of SBM Offshore and Mannatech Incorporated.
Diversification Opportunities for SBM Offshore and Mannatech Incorporated
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between SBM and Mannatech is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding SBM Offshore NV and Mannatech Incorporated in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mannatech Incorporated and SBM Offshore 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 SBM Offshore NV are associated (or correlated) with Mannatech Incorporated. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mannatech Incorporated has no effect on the direction of SBM Offshore i.e., SBM Offshore and Mannatech Incorporated go up and down completely randomly.
Pair Corralation between SBM Offshore and Mannatech Incorporated
Assuming the 90 days horizon SBM Offshore is expected to generate 44.95 times less return on investment than Mannatech Incorporated. But when comparing it to its historical volatility, SBM Offshore NV is 41.76 times less risky than Mannatech Incorporated. It trades about 0.07 of its potential returns per unit of risk. Mannatech Incorporated is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 801.00 in Mannatech Incorporated on September 3, 2024 and sell it today you would earn a total of 49.00 from holding Mannatech Incorporated or generate 6.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 92.47% |
| Values | Daily Returns |
SBM Offshore NV vs. Mannatech Incorporated
Performance |
| Timeline |
| SBM Offshore NV |
| Mannatech Incorporated |
SBM Offshore and Mannatech Incorporated Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SBM Offshore and Mannatech Incorporated
The main advantage of trading using opposite SBM Offshore and Mannatech Incorporated positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SBM Offshore position performs unexpectedly, Mannatech Incorporated 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 Mannatech Incorporated will offset losses from the drop in Mannatech Incorporated's long position.| SBM Offshore vs. Expro Group Holdings | SBM Offshore vs. ChampionX | SBM Offshore vs. Ranger Energy Services | SBM Offshore vs. Cactus Inc |
| Mannatech Incorporated vs. Edgewell Personal Care | Mannatech Incorporated vs. Inter Parfums | Mannatech Incorporated vs. Nu Skin Enterprises | Mannatech Incorporated vs. Helen of Troy |
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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