Correlation Between Martin Marietta and Amundi Physical

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

By analyzing existing cross correlation between Martin Marietta Materials and Amundi Physical Gold, you can compare the effects of market volatilities on Martin Marietta and Amundi Physical 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 Martin Marietta with a short position of Amundi Physical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Martin Marietta and Amundi Physical.

Diversification Opportunities for Martin Marietta and Amundi Physical

-0.49

Correlation Coefficient

Martin Marietta  Amundi Physical

Very good diversification

The 3 months correlation between Martin and Amundi is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Martin Marietta Materials and Amundi Physical Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amundi Physical Gold and Martin Marietta 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 Martin Marietta Materials are associated (or correlated) with Amundi Physical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amundi Physical Gold has no effect on the direction of Martin Marietta i.e., Martin Marietta and Amundi Physical go up and down completely randomly.

Pair Corralation between Martin Marietta and Amundi Physical

Assuming the 90 days trading horizon Martin Marietta Materials is expected to under-perform the Amundi Physical. In addition to that, Martin Marietta is 2.12 times more volatile than Amundi Physical Gold. It trades about -0.08 of its total potential returns per unit of risk. Amundi Physical Gold is currently generating about 0.25 per unit of volatility. If you would invest  826,388  in Amundi Physical Gold on December 31, 2024 and sell it today you would earn a total of  118,125  from holding Amundi Physical Gold or generate 14.29% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	87.5%
Values	Daily Returns

Martin Marietta Materials  vs.  Amundi Physical Gold

Martin Marietta Materials

Risk-Adjusted Performance

Very Weak

Over the last 90 days Martin Marietta Materials has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Amundi Physical Gold

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Amundi Physical Gold are ranked lower than 20 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, Amundi Physical unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Martin Marietta and Amundi Physical

The main advantage of trading using opposite Martin Marietta and Amundi Physical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Martin Marietta position performs unexpectedly, Amundi Physical 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 Amundi Physical will offset losses from the drop in Amundi Physical's long position.

The idea behind Martin Marietta Materials and Amundi Physical Gold 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.