Correlation Between Marine Petroleum and AZZ Incorporated

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

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

Diversification Opportunities for Marine Petroleum and AZZ Incorporated

0.31

Correlation Coefficient

Marine Petroleum  AZZ Incorporated

Weak diversification

The 3 months correlation between Marine and AZZ is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Marine Petroleum Trust and AZZ Incorporated in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AZZ Incorporated and Marine Petroleum 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 Marine Petroleum Trust are associated (or correlated) with AZZ Incorporated. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AZZ Incorporated has no effect on the direction of Marine Petroleum i.e., Marine Petroleum and AZZ Incorporated go up and down completely randomly.

Pair Corralation between Marine Petroleum and AZZ Incorporated

Assuming the 90 days horizon Marine Petroleum Trust is expected to generate 3.88 times more return on investment than AZZ Incorporated. However, Marine Petroleum is 3.88 times more volatile than AZZ Incorporated. It trades about 0.07 of its potential returns per unit of risk. AZZ Incorporated is currently generating about 0.2 per unit of risk. If you would invest  378.00  in Marine Petroleum Trust on May 7, 2025 and sell it today you would earn a total of  68.00  from holding Marine Petroleum Trust or generate 17.99% return on investment over 90 days.

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

Marine Petroleum Trust  vs.  AZZ Incorporated

Marine Petroleum Trust

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Marine Petroleum Trust are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Marine Petroleum unveiled solid returns over the last few months and may actually be approaching a breakup point.

AZZ Incorporated

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in AZZ Incorporated are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of fairly conflicting basic indicators, AZZ Incorporated showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Marine Petroleum and AZZ Incorporated

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

The idea behind Marine Petroleum Trust and AZZ Incorporated 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.