Correlation Between MASCO and Spectrum Brands
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By analyzing existing cross correlation between MASCO P 775 and Spectrum Brands Holdings, you can compare the effects of market volatilities on MASCO and Spectrum Brands 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 MASCO with a short position of Spectrum Brands. Check out your portfolio center. Please also check ongoing floating volatility patterns of MASCO and Spectrum Brands.
Diversification Opportunities for MASCO and Spectrum Brands
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between MASCO and Spectrum is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding MASCO P 775 and Spectrum Brands Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Spectrum Brands Holdings and MASCO 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 MASCO P 775 are associated (or correlated) with Spectrum Brands. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Spectrum Brands Holdings has no effect on the direction of MASCO i.e., MASCO and Spectrum Brands go up and down completely randomly.
Pair Corralation between MASCO and Spectrum Brands
Assuming the 90 days trading horizon MASCO P 775 is expected to under-perform the Spectrum Brands. But the bond apears to be less risky and, when comparing its historical volatility, MASCO P 775 is 2.63 times less risky than Spectrum Brands. The bond trades about -0.06 of its potential returns per unit of risk. The Spectrum Brands Holdings is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 8,982 in Spectrum Brands Holdings on September 12, 2024 and sell it today you would earn a total of 122.00 from holding Spectrum Brands Holdings or generate 1.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 93.75% |
| Values | Daily Returns |
MASCO P 775 vs. Spectrum Brands Holdings
Performance |
| Timeline |
| MASCO P 775 |
| Spectrum Brands Holdings |
MASCO and Spectrum Brands Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MASCO and Spectrum Brands
The main advantage of trading using opposite MASCO and Spectrum Brands positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MASCO position performs unexpectedly, Spectrum Brands 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 Spectrum Brands will offset losses from the drop in Spectrum Brands' long position.| MASCO vs. AEP TEX INC | MASCO vs. US BANK NATIONAL | MASCO vs. Applied Blockchain | MASCO vs. BigBearai Holdings |
| Spectrum Brands vs. European Wax Center | Spectrum Brands vs. Inter Parfums | Spectrum Brands vs. Mannatech Incorporated | Spectrum Brands vs. Nu Skin Enterprises |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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