Correlation Between Macerich and FC Investment
Can any of the company-specific risk be diversified away by investing in both Macerich and FC Investment 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 Macerich and FC Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Macerich Co and FC Investment Trust, you can compare the effects of market volatilities on Macerich and FC Investment 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 Macerich with a short position of FC Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Macerich and FC Investment.
Diversification Opportunities for Macerich and FC Investment
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Macerich and FCIT is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Macerich Co and FC Investment Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FC Investment Trust and Macerich 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 Macerich Co are associated (or correlated) with FC Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FC Investment Trust has no effect on the direction of Macerich i.e., Macerich and FC Investment go up and down completely randomly.
Pair Corralation between Macerich and FC Investment
Assuming the 90 days trading horizon Macerich Co is expected to generate 2.87 times more return on investment than FC Investment. However, Macerich is 2.87 times more volatile than FC Investment Trust. It trades about 0.08 of its potential returns per unit of risk. FC Investment Trust is currently generating about 0.1 per unit of risk. If you would invest 1,503 in Macerich Co on September 12, 2024 and sell it today you would earn a total of 626.00 from holding Macerich Co or generate 41.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 94.38% |
| Values | Daily Returns |
Macerich Co vs. FC Investment Trust
Performance |
| Timeline |
| Macerich |
| FC Investment Trust |
Macerich and FC Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Macerich and FC Investment
The main advantage of trading using opposite Macerich and FC Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Macerich position performs unexpectedly, FC Investment 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 FC Investment will offset losses from the drop in FC Investment's long position.| Macerich vs. FC Investment Trust | Macerich vs. Datalogic | Macerich vs. Lowland Investment Co | Macerich vs. Alliance Data Systems |
| FC Investment vs. UNIQA Insurance Group | FC Investment vs. Zurich Insurance Group | FC Investment vs. Axfood AB | FC Investment vs. European Metals Holdings |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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