Correlation Between Macquarie Group and Moodys
Can any of the company-specific risk be diversified away by investing in both Macquarie Group and Moodys 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 Macquarie Group and Moodys into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Macquarie Group Limited and Moodys, you can compare the effects of market volatilities on Macquarie Group and Moodys 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 Macquarie Group with a short position of Moodys. Check out your portfolio center. Please also check ongoing floating volatility patterns of Macquarie Group and Moodys.
Diversification Opportunities for Macquarie Group and Moodys
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Macquarie and Moodys is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Macquarie Group Limited and Moodys in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Moodys and Macquarie Group 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 Macquarie Group Limited are associated (or correlated) with Moodys. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Moodys has no effect on the direction of Macquarie Group i.e., Macquarie Group and Moodys go up and down completely randomly.
Pair Corralation between Macquarie Group and Moodys
Assuming the 90 days horizon Macquarie Group Limited is expected to under-perform the Moodys. But the stock apears to be less risky and, when comparing its historical volatility, Macquarie Group Limited is 1.24 times less risky than Moodys. The stock trades about -0.06 of its potential returns per unit of risk. The Moodys is currently generating about -0.04 of returns per unit of risk over similar time horizon. If you would invest 45,184 in Moodys on October 16, 2024 and sell it today you would lose (1,204) from holding Moodys or give up 2.66% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 97.37% |
| Values | Daily Returns |
Macquarie Group Limited vs. Moodys
Performance |
| Timeline |
| Macquarie Group |
| Moodys |
Macquarie Group and Moodys Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Macquarie Group and Moodys
The main advantage of trading using opposite Macquarie Group and Moodys positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Macquarie Group position performs unexpectedly, Moodys 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 Moodys will offset losses from the drop in Moodys' long position.| Macquarie Group vs. INSURANCE AUST GRP | Macquarie Group vs. Hyster Yale Materials Handling | Macquarie Group vs. Goodyear Tire Rubber | Macquarie Group vs. Summit Materials |
| Moodys vs. Easy Software AG | Moodys vs. GBS Software AG | Moodys vs. IDP EDUCATION LTD | Moodys vs. Grand Canyon Education |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
Other Complementary Tools
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Stocks Directory Find actively traded stocks across global markets | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum |