Correlation Between ABACUS STORAGE and Macquarie Group
Can any of the company-specific risk be diversified away by investing in both ABACUS STORAGE and Macquarie Group 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 ABACUS STORAGE and Macquarie Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ABACUS STORAGE KING and Macquarie Group Ltd, you can compare the effects of market volatilities on ABACUS STORAGE and Macquarie Group 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 ABACUS STORAGE with a short position of Macquarie Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of ABACUS STORAGE and Macquarie Group.
Diversification Opportunities for ABACUS STORAGE and Macquarie Group
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between ABACUS and Macquarie is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding ABACUS STORAGE KING and Macquarie Group Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Macquarie Group and ABACUS STORAGE 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 ABACUS STORAGE KING are associated (or correlated) with Macquarie Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Macquarie Group has no effect on the direction of ABACUS STORAGE i.e., ABACUS STORAGE and Macquarie Group go up and down completely randomly.
Pair Corralation between ABACUS STORAGE and Macquarie Group
Assuming the 90 days trading horizon ABACUS STORAGE KING is expected to generate 4.71 times more return on investment than Macquarie Group. However, ABACUS STORAGE is 4.71 times more volatile than Macquarie Group Ltd. It trades about 0.16 of its potential returns per unit of risk. Macquarie Group Ltd is currently generating about 0.09 per unit of risk. If you would invest 115.00 in ABACUS STORAGE KING on December 4, 2024 and sell it today you would earn a total of 6.00 from holding ABACUS STORAGE KING or generate 5.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ABACUS STORAGE KING vs. Macquarie Group Ltd
Performance |
| Timeline |
| ABACUS STORAGE KING |
| Macquarie Group |
ABACUS STORAGE and Macquarie Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ABACUS STORAGE and Macquarie Group
The main advantage of trading using opposite ABACUS STORAGE and Macquarie Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ABACUS STORAGE position performs unexpectedly, Macquarie Group 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 Macquarie Group will offset losses from the drop in Macquarie Group's long position.| ABACUS STORAGE vs. Flagship Investments | ABACUS STORAGE vs. Clime Investment Management | ABACUS STORAGE vs. Platinum Asia Investments | ABACUS STORAGE vs. Auctus Alternative Investments |
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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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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