Correlation Between Standard Bank and Marine Bancorp
Can any of the company-specific risk be diversified away by investing in both Standard Bank and Marine Bancorp 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 Standard Bank and Marine Bancorp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Standard Bank Group and Marine Bancorp of, you can compare the effects of market volatilities on Standard Bank and Marine Bancorp 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 Standard Bank with a short position of Marine Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Standard Bank and Marine Bancorp.
Diversification Opportunities for Standard Bank and Marine Bancorp
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Standard and Marine is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Standard Bank Group and Marine Bancorp of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marine Bancorp and Standard Bank 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 Standard Bank Group are associated (or correlated) with Marine Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marine Bancorp has no effect on the direction of Standard Bank i.e., Standard Bank and Marine Bancorp go up and down completely randomly.
Pair Corralation between Standard Bank and Marine Bancorp
Assuming the 90 days horizon Standard Bank Group is expected to under-perform the Marine Bancorp. In addition to that, Standard Bank is 2.88 times more volatile than Marine Bancorp of. It trades about -0.43 of its total potential returns per unit of risk. Marine Bancorp of is currently generating about 0.14 per unit of volatility. If you would invest 3,960 in Marine Bancorp of on October 9, 2024 and sell it today you would earn a total of 40.00 from holding Marine Bancorp of or generate 1.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Standard Bank Group vs. Marine Bancorp of
Performance |
| Timeline |
| Standard Bank Group |
| Marine Bancorp |
Standard Bank and Marine Bancorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Standard Bank and Marine Bancorp
The main advantage of trading using opposite Standard Bank and Marine Bancorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Standard Bank position performs unexpectedly, Marine Bancorp 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 Marine Bancorp will offset losses from the drop in Marine Bancorp's long position.| Standard Bank vs. Bank Central Asia | Standard Bank vs. Nedbank Group | Standard Bank vs. Kasikornbank Public Co | Standard Bank vs. KBC Groep NV |
| Marine Bancorp vs. Dave Busters Entertainment | Marine Bancorp vs. HF Sinclair Corp | Marine Bancorp vs. Delta Air Lines | Marine Bancorp vs. Boyd Gaming |
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.
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