Correlation Between TechnipFMC PLC and Marcus
Can any of the company-specific risk be diversified away by investing in both TechnipFMC PLC and Marcus 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 TechnipFMC PLC and Marcus into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TechnipFMC PLC and Marcus, you can compare the effects of market volatilities on TechnipFMC PLC and Marcus 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 TechnipFMC PLC with a short position of Marcus. Check out your portfolio center. Please also check ongoing floating volatility patterns of TechnipFMC PLC and Marcus.
Diversification Opportunities for TechnipFMC PLC and Marcus
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between TechnipFMC and Marcus is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding TechnipFMC PLC and Marcus in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marcus and TechnipFMC PLC 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 TechnipFMC PLC are associated (or correlated) with Marcus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marcus has no effect on the direction of TechnipFMC PLC i.e., TechnipFMC PLC and Marcus go up and down completely randomly.
Pair Corralation between TechnipFMC PLC and Marcus
Considering the 90-day investment horizon TechnipFMC PLC is expected to generate 1.82 times more return on investment than Marcus. However, TechnipFMC PLC is 1.82 times more volatile than Marcus. It trades about 0.1 of its potential returns per unit of risk. Marcus is currently generating about -0.01 per unit of risk. If you would invest 747.00 in TechnipFMC PLC on December 30, 2023 and sell it today you would earn a total of 1,764 from holding TechnipFMC PLC or generate 236.14% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
TechnipFMC PLC vs. Marcus
Performance |
Timeline |
TechnipFMC PLC |
Marcus |
TechnipFMC PLC and Marcus Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with TechnipFMC PLC and Marcus
The main advantage of trading using opposite TechnipFMC PLC and Marcus positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TechnipFMC PLC position performs unexpectedly, Marcus 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 Marcus will offset losses from the drop in Marcus' long position.TechnipFMC PLC vs. Newpark Resources | TechnipFMC PLC vs. Tenaris SA ADR | TechnipFMC PLC vs. Now Inc | TechnipFMC PLC vs. Dawson Geophysical |
Marcus vs. Madison Square Garden | Marcus vs. Anghami Warrants | Marcus vs. Alliance Entertainment Holding | Marcus vs. News Corp A |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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