Correlation Between Malibu Boats and Amer Sports,

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

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

Diversification Opportunities for Malibu Boats and Amer Sports,

0.08

Correlation Coefficient

Malibu Boats  Amer Sports,

Significant diversification

The 3 months correlation between Malibu and Amer is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Malibu Boats and Amer Sports, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amer Sports, and Malibu Boats 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 Malibu Boats are associated (or correlated) with Amer Sports,. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amer Sports, has no effect on the direction of Malibu Boats i.e., Malibu Boats and Amer Sports, go up and down completely randomly.

Pair Corralation between Malibu Boats and Amer Sports,

Given the investment horizon of 90 days Malibu Boats is expected to under-perform the Amer Sports,. But the stock apears to be less risky and, when comparing its historical volatility, Malibu Boats is 1.27 times less risky than Amer Sports,. The stock trades about -0.01 of its potential returns per unit of risk. The Amer Sports, is currently generating about 0.3 of returns per unit of risk over similar time horizon. If you would invest  1,595  in Amer Sports, on September 29, 2024 and sell it today you would earn a total of  1,247  from holding Amer Sports, or generate 78.18% return on investment over 90 days.

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

Malibu Boats  vs.  Amer Sports,

Malibu Boats

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Malibu Boats has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Malibu Boats is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Amer Sports,

Risk-Adjusted Performance

23 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Amer Sports, are ranked lower than 23 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively conflicting basic indicators, Amer Sports, unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Malibu Boats and Amer Sports,

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

The idea behind Malibu Boats and Amer Sports, 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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.