Correlation Between Credit Corp and Macquarie
Can any of the company-specific risk be diversified away by investing in both Credit Corp and Macquarie 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 Credit Corp and Macquarie into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Credit Corp Group and Macquarie Group, you can compare the effects of market volatilities on Credit Corp and Macquarie 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 Credit Corp with a short position of Macquarie. Check out your portfolio center. Please also check ongoing floating volatility patterns of Credit Corp and Macquarie.
Diversification Opportunities for Credit Corp and Macquarie
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Credit and Macquarie is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Credit Corp Group and Macquarie Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Macquarie Group and Credit Corp 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 Credit Corp Group are associated (or correlated) with Macquarie. 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 Credit Corp i.e., Credit Corp and Macquarie go up and down completely randomly.
Pair Corralation between Credit Corp and Macquarie
Assuming the 90 days trading horizon Credit Corp is expected to generate 76.29 times less return on investment than Macquarie. In addition to that, Credit Corp is 2.42 times more volatile than Macquarie Group. It trades about 0.0 of its total potential returns per unit of risk. Macquarie Group is currently generating about 0.09 per unit of volatility. If you would invest 16,226 in Macquarie Group on September 12, 2024 and sell it today you would earn a total of 6,459 from holding Macquarie Group or generate 39.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Credit Corp Group vs. Macquarie Group
Performance |
| Timeline |
| Credit Corp Group |
| Macquarie Group |
Credit Corp and Macquarie Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Credit Corp and Macquarie
The main advantage of trading using opposite Credit Corp and Macquarie positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Credit Corp position performs unexpectedly, Macquarie 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 will offset losses from the drop in Macquarie's long position.| Credit Corp vs. Ora Banda Mining | Credit Corp vs. Srj Technologies Group | Credit Corp vs. Metro Mining | Credit Corp vs. Aspire Mining |
| Macquarie vs. Austco Healthcare | Macquarie vs. Bell Financial Group | Macquarie vs. Oneview Healthcare PLC | Macquarie vs. Bank of Queensland |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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