Correlation Between Marten Transport and Azul SA

Can any of the company-specific risk be diversified away by investing in both Marten Transport and Azul SA 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 Marten Transport and Azul SA into the same portfolio, which is an essential part of the fundamental portfolio management process.

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

Diversification Opportunities for Marten Transport and Azul SA

0.18

Correlation Coefficient

Marten Transport  Azul SA

Average diversification

The 3 months correlation between Marten and Azul is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Marten Transport and Azul SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Azul SA and Marten Transport 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 Marten Transport are associated (or correlated) with Azul SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Azul SA has no effect on the direction of Marten Transport i.e., Marten Transport and Azul SA go up and down completely randomly.

Pair Corralation between Marten Transport and Azul SA

If you would invest  0.00  in Azul SA on May 7, 2025 and sell it today you would earn a total of  0.00  from holding Azul SA or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	1.61%
Values	Daily Returns

Marten Transport  vs.  Azul SA

Marten Transport

Risk-Adjusted Performance

Weakest

Over the last 90 days Marten Transport has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Marten Transport is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Azul SA

Risk-Adjusted Performance

Weakest

Over the last 90 days Azul SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent basic indicators, Azul SA is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with Marten Transport and Azul SA

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

The idea behind Marten Transport and Azul SA 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 Search module to search for actively traded equities including funds and ETFs from over 30 global markets.