Correlation Between Aeorema Communications and Macy#39;s
Can any of the company-specific risk be diversified away by investing in both Aeorema Communications and Macy#39;s 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 Aeorema Communications and Macy#39;s into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aeorema Communications Plc and Macy Inc, you can compare the effects of market volatilities on Aeorema Communications and Macy#39;s 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 Aeorema Communications with a short position of Macy#39;s. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aeorema Communications and Macy#39;s.
Diversification Opportunities for Aeorema Communications and Macy#39;s
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Aeorema and Macy#39;s is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Aeorema Communications Plc and Macy Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Macy#39;s and Aeorema Communications 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 Aeorema Communications Plc are associated (or correlated) with Macy#39;s. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Macy#39;s has no effect on the direction of Aeorema Communications i.e., Aeorema Communications and Macy#39;s go up and down completely randomly.
Pair Corralation between Aeorema Communications and Macy#39;s
If you would invest (100.00) in Macy Inc on January 1, 2025 and sell it today you would earn a total of 100.00 from holding Macy Inc or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Aeorema Communications Plc vs. Macy Inc
Performance |
| Timeline |
| Aeorema Communications |
| Macy#39;s |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
Aeorema Communications and Macy#39;s Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aeorema Communications and Macy#39;s
The main advantage of trading using opposite Aeorema Communications and Macy#39;s positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aeorema Communications position performs unexpectedly, Macy#39;s 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 Macy#39;s will offset losses from the drop in Macy#39;s' long position.| Aeorema Communications vs. Flow Traders NV | Aeorema Communications vs. Beowulf Mining | Aeorema Communications vs. Coeur Mining | Aeorema Communications vs. Batm Advanced Communications |
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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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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