Correlation Between Disney and Marcus
Can any of the company-specific risk be diversified away by investing in both Disney and Marcus 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 Disney and Marcus into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Walt Disney and Marcus, you can compare the effects of market volatilities on Disney and Marcus 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 Disney with a short position of Marcus. Check out your portfolio center. Please also check ongoing floating volatility patterns of Disney and Marcus.
Diversification Opportunities for Disney and Marcus
Weak diversification
The 3 months correlation between Disney and Marcus is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Walt Disney and Marcus in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marcus and Disney 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 Walt Disney are associated (or correlated) with Marcus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marcus has no effect on the direction of Disney i.e., Disney and Marcus go up and down completely randomly.
Pair Corralation between Disney and Marcus
Considering the 90-day investment horizon Walt Disney is expected to under-perform the Marcus. But the stock apears to be less risky and, when comparing its historical volatility, Walt Disney is 1.67 times less risky than Marcus. The stock trades about -0.16 of its potential returns per unit of risk. The Marcus is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 1,560 in Marcus on August 27, 2025 and sell it today you would lose (51.00) from holding Marcus or give up 3.27% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Walt Disney vs. Marcus
Performance |
| Timeline |
| Walt Disney |
| Marcus |
Disney and Marcus Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Disney and Marcus
The main advantage of trading using opposite Disney and Marcus positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Disney position performs unexpectedly, Marcus 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 Marcus will offset losses from the drop in Marcus' long position.| Disney vs. Merck Company | Disney vs. Alcoa Corp | Disney vs. Neuberger Berman Small | Disney vs. Canadian General Investments |
| Marcus vs. IDP Education Limited | Marcus vs. Jianzhi Education Technology | Marcus vs. PARKSON Retail Group | Marcus vs. Fast Retailing Co |
Check out your portfolio center.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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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