Correlation Between Maris Tech and Ocado Group

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

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

Diversification Opportunities for Maris Tech and Ocado Group

-0.9

Correlation Coefficient

Maris Tech  Ocado Group

Pay attention - limited upside

The 3 months correlation between Maris and Ocado is -0.9. Overlapping area represents the amount of risk that can be diversified away by holding Maris Tech and Ocado Group plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ocado Group plc and Maris Tech 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 Maris Tech are associated (or correlated) with Ocado Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ocado Group plc has no effect on the direction of Maris Tech i.e., Maris Tech and Ocado Group go up and down completely randomly.

Pair Corralation between Maris Tech and Ocado Group

Given the investment horizon of 90 days Maris Tech is expected to generate 1.06 times more return on investment than Ocado Group. However, Maris Tech is 1.06 times more volatile than Ocado Group plc. It trades about 0.04 of its potential returns per unit of risk. Ocado Group plc is currently generating about -0.3 per unit of risk. If you would invest  149.00  in Maris Tech on January 30, 2024 and sell it today you would earn a total of  3.00  from holding Maris Tech or generate 2.01% return on investment over 90 days.

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

Maris Tech  vs.  Ocado Group plc

Maris Tech

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Maris Tech are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite quite inconsistent technical and fundamental indicators, Maris Tech disclosed solid returns over the last few months and may actually be approaching a breakup point.

Ocado Group plc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ocado Group plc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's fundamental indicators remain fairly strong which may send shares a bit higher in May 2024. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Maris Tech and Ocado Group

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

The idea behind Maris Tech and Ocado Group plc 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.