Correlation Between Douglas Emmett and Marine Products

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

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

Diversification Opportunities for Douglas Emmett and Marine Products

0.52

Correlation Coefficient

Douglas Emmett  Marine Products

Very weak diversification

The 3 months correlation between Douglas and Marine is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Douglas Emmett and Marine Products in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marine Products and Douglas Emmett 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 Douglas Emmett are associated (or correlated) with Marine Products. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marine Products has no effect on the direction of Douglas Emmett i.e., Douglas Emmett and Marine Products go up and down completely randomly.

Pair Corralation between Douglas Emmett and Marine Products

Considering the 90-day investment horizon Douglas Emmett is expected to under-perform the Marine Products. But the stock apears to be less risky and, when comparing its historical volatility, Douglas Emmett is 1.1 times less risky than Marine Products. The stock trades about -0.09 of its potential returns per unit of risk. The Marine Products is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  833.00  in Marine Products on August 4, 2025 and sell it today you would earn a total of  12.00  from holding Marine Products or generate 1.44% return on investment over 90 days.

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

Douglas Emmett  vs.  Marine Products

Douglas Emmett

Risk-Adjusted Performance

Weakest

Over the last 90 days Douglas Emmett has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest uncertain performance, the Stock's technical and fundamental indicators remain strong and the recent confusion on Wall Street may also be a sign of long-lasting gains for the firm traders.

Marine Products

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Marine Products are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong basic indicators, Marine Products is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Douglas Emmett and Marine Products

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

The idea behind Douglas Emmett and Marine Products 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.