Correlation Between Macquarie Group and Identiv
Can any of the company-specific risk be diversified away by investing in both Macquarie Group and Identiv 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 Identiv 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 Identiv, you can compare the effects of market volatilities on Macquarie Group and Identiv 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 Identiv. Check out your portfolio center. Please also check ongoing floating volatility patterns of Macquarie Group and Identiv.
Diversification Opportunities for Macquarie Group and Identiv
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Macquarie and Identiv is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Macquarie Group Limited and Identiv in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Identiv 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 Identiv. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Identiv has no effect on the direction of Macquarie Group i.e., Macquarie Group and Identiv go up and down completely randomly.
Pair Corralation between Macquarie Group and Identiv
Assuming the 90 days horizon Macquarie Group is expected to generate 16.24 times less return on investment than Identiv. But when comparing it to its historical volatility, Macquarie Group Limited is 2.01 times less risky than Identiv. It trades about 0.01 of its potential returns per unit of risk. Identiv is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 337.00 in Identiv on August 25, 2024 and sell it today you would earn a total of 23.00 from holding Identiv or generate 6.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Macquarie Group Limited vs. Identiv
Performance |
| Timeline |
| Macquarie Group |
| Identiv |
Macquarie Group and Identiv Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Macquarie Group and Identiv
The main advantage of trading using opposite Macquarie Group and Identiv positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Macquarie Group position performs unexpectedly, Identiv 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 Identiv will offset losses from the drop in Identiv's long position.| Macquarie Group vs. Gruppo Mutuionline SpA | Macquarie Group vs. The Hanover Insurance | Macquarie Group vs. Insurance Australia Group | Macquarie Group vs. MUTUIONLINE |
| Identiv vs. COVIVIO HOTELS INH | Identiv vs. Alaska Air Group | Identiv vs. Hyatt Hotels | Identiv vs. LAir Liquide SA |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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