Correlation Between Visteon Corp and Marine Products
Can any of the company-specific risk be diversified away by investing in both Visteon Corp and Marine Products 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 Visteon Corp and Marine Products into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Visteon Corp and Marine Products, you can compare the effects of market volatilities on Visteon Corp and Marine Products 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 Visteon Corp with a short position of Marine Products. Check out your portfolio center. Please also check ongoing floating volatility patterns of Visteon Corp and Marine Products.
Diversification Opportunities for Visteon Corp and Marine Products
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Visteon and Marine is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Visteon Corp and Marine Products in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marine Products and Visteon Corp 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 Visteon Corp are associated (or correlated) with Marine Products. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marine Products has no effect on the direction of Visteon Corp i.e., Visteon Corp and Marine Products go up and down completely randomly.
Pair Corralation between Visteon Corp and Marine Products
Allowing for the 90-day total investment horizon Visteon Corp is expected to generate 0.82 times more return on investment than Marine Products. However, Visteon Corp is 1.22 times less risky than Marine Products. It trades about 0.07 of its potential returns per unit of risk. Marine Products is currently generating about -0.08 per unit of risk. If you would invest 8,699 in Visteon Corp on November 28, 2024 and sell it today you would earn a total of 225.00 from holding Visteon Corp or generate 2.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Visteon Corp vs. Marine Products
Performance |
| Timeline |
| Visteon Corp |
| Marine Products |
Visteon Corp and Marine Products Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Visteon Corp and Marine Products
The main advantage of trading using opposite Visteon Corp and Marine Products positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Visteon Corp position performs unexpectedly, Marine Products 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 Products will offset losses from the drop in Marine Products' long position.| Visteon Corp vs. Gentex | Visteon Corp vs. Adient PLC | Visteon Corp vs. Autoliv | Visteon Corp vs. Fox Factory Holding |
| Marine Products vs. Thor Industries | Marine Products vs. BRP Inc | Marine Products vs. Brunswick | Marine Products vs. EZGO Technologies |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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