Correlation Between Siriuspoint and Marine Products

Can any of the company-specific risk be diversified away by investing in both Siriuspoint 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 Siriuspoint and Marine Products into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Siriuspoint and Marine Products, you can compare the effects of market volatilities on Siriuspoint 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 Siriuspoint with a short position of Marine Products. Check out your portfolio center. Please also check ongoing floating volatility patterns of Siriuspoint and Marine Products.

Diversification Opportunities for Siriuspoint and Marine Products

0.52

Correlation Coefficient

Siriuspoint  Marine Products

Very weak diversification

The 3 months correlation between Siriuspoint and Marine is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Siriuspoint and Marine Products in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marine Products and Siriuspoint 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 Siriuspoint 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 Siriuspoint i.e., Siriuspoint and Marine Products go up and down completely randomly.

Pair Corralation between Siriuspoint and Marine Products

Given the investment horizon of 90 days Siriuspoint is expected to generate 1.34 times more return on investment than Marine Products. However, Siriuspoint is 1.34 times more volatile than Marine Products. It trades about 0.33 of its potential returns per unit of risk. Marine Products is currently generating about 0.14 per unit of risk. If you would invest  1,314  in Siriuspoint on September 5, 2024 and sell it today you would earn a total of  242.00  from holding Siriuspoint or generate 18.42% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Siriuspoint  vs.  Marine Products

Siriuspoint

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Siriuspoint are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Siriuspoint may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Marine Products

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Marine Products are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unfluctuating basic indicators, Marine Products may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Siriuspoint and Marine Products

The main advantage of trading using opposite Siriuspoint and Marine Products positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Siriuspoint 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.

The idea behind Siriuspoint and Marine Products pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.