Correlation Between Idaho Strategic and MARTIN

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

By analyzing existing cross correlation between Idaho Strategic Resources and MARTIN MARIETTA MATLS, you can compare the effects of market volatilities on Idaho Strategic and MARTIN 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 Idaho Strategic with a short position of MARTIN. Check out your portfolio center. Please also check ongoing floating volatility patterns of Idaho Strategic and MARTIN.

Diversification Opportunities for Idaho Strategic and MARTIN

0.61

Correlation Coefficient

Idaho Strategic  MARTIN

Poor diversification

The 3 months correlation between Idaho and MARTIN is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Idaho Strategic Resources and MARTIN MARIETTA MATLS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MARTIN MARIETTA MATLS and Idaho Strategic 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 Idaho Strategic Resources are associated (or correlated) with MARTIN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MARTIN MARIETTA MATLS has no effect on the direction of Idaho Strategic i.e., Idaho Strategic and MARTIN go up and down completely randomly.

Pair Corralation between Idaho Strategic and MARTIN

Considering the 90-day investment horizon Idaho Strategic Resources is expected to generate 3.82 times more return on investment than MARTIN. However, Idaho Strategic is 3.82 times more volatile than MARTIN MARIETTA MATLS. It trades about 0.04 of its potential returns per unit of risk. MARTIN MARIETTA MATLS is currently generating about 0.04 per unit of risk. If you would invest  910.00  in Idaho Strategic Resources on October 12, 2024 and sell it today you would earn a total of  112.00  from holding Idaho Strategic Resources or generate 12.31% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	55.08%
Values	Daily Returns

Idaho Strategic Resources  vs.  MARTIN MARIETTA MATLS

Idaho Strategic Resources

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Idaho Strategic Resources has generated negative risk-adjusted returns adding no value to investors with long positions. Even with unsteady performance in the last few months, the Stock's fundamental indicators remain relatively invariable which may send shares a bit higher in February 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

MARTIN MARIETTA MATLS

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days MARTIN MARIETTA MATLS has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, MARTIN is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Idaho Strategic and MARTIN

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

The idea behind Idaho Strategic Resources and MARTIN MARIETTA MATLS 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.