Correlation Between Mauch Chunk and Mars Bancorp

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

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

Diversification Opportunities for Mauch Chunk and Mars Bancorp

0.0

Correlation Coefficient

Mauch Chunk  Mars Bancorp

Pay attention - limited upside

The 3 months correlation between Mauch and Mars is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Mauch Chunk Trust and Mars Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mars Bancorp and Mauch Chunk 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 Mauch Chunk Trust are associated (or correlated) with Mars Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mars Bancorp has no effect on the direction of Mauch Chunk i.e., Mauch Chunk and Mars Bancorp go up and down completely randomly.

Pair Corralation between Mauch Chunk and Mars Bancorp

If you would invest  665.00  in Mauch Chunk Trust on December 27, 2024 and sell it today you would lose (5.00) from holding Mauch Chunk Trust or give up 0.75% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Mauch Chunk Trust  vs.  Mars Bancorp

Mauch Chunk Trust

Risk-Adjusted Performance

Very Weak

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

Mars Bancorp

Risk-Adjusted Performance

Very Weak

Over the last 90 days Mars Bancorp has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable fundamental drivers, Mars Bancorp is not utilizing all of its potentials. The newest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Mauch Chunk and Mars Bancorp

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

The idea behind Mauch Chunk Trust and Mars Bancorp 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.