Correlation Between Malibu Boats and Camping World

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Can any of the company-specific risk be diversified away by investing in both Malibu Boats and Camping World 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 Malibu Boats and Camping World into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Malibu Boats and Camping World Holdings, you can compare the effects of market volatilities on Malibu Boats and Camping World 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 Malibu Boats with a short position of Camping World. Check out your portfolio center. Please also check ongoing floating volatility patterns of Malibu Boats and Camping World.

Diversification Opportunities for Malibu Boats and Camping World

0.68
  Correlation Coefficient

Poor diversification

The 3 months correlation between Malibu and Camping is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Malibu Boats and Camping World Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Camping World Holdings and Malibu Boats 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 Malibu Boats are associated (or correlated) with Camping World. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Camping World Holdings has no effect on the direction of Malibu Boats i.e., Malibu Boats and Camping World go up and down completely randomly.

Pair Corralation between Malibu Boats and Camping World

Given the investment horizon of 90 days Malibu Boats is expected to generate 0.56 times more return on investment than Camping World. However, Malibu Boats is 1.79 times less risky than Camping World. It trades about -0.29 of its potential returns per unit of risk. Camping World Holdings is currently generating about -0.17 per unit of risk. If you would invest  6,003  in Malibu Boats on July 2, 2022 and sell it today you would lose (960.00)  from holding Malibu Boats or give up 15.99% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

Malibu Boats  vs.  Camping World Holdings

 Performance (%) 
       Timeline  
Malibu Boats 
Malibu Performance
0 of 100
Over the last 90 days Malibu Boats has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest conflicting performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Malibu Price Channel

Camping World Holdings 
Camping Performance
3 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Camping World Holdings are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite nearly conflicting basic indicators, Camping World may actually be approaching a critical reversion point that can send shares even higher in October 2022.

Camping Price Channel

Malibu Boats and Camping World Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Malibu Boats and Camping World

The main advantage of trading using opposite Malibu Boats and Camping World positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Malibu Boats position performs unexpectedly, Camping World 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 Camping World will offset losses from the drop in Camping World's long position.
Malibu Boats vs. Amazon Inc
The idea behind Malibu Boats and Camping World Holdings 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.
Camping World vs. Amazon Inc
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 Fund Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.

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