Correlation Between Clime Investment and Macquarie
Can any of the company-specific risk be diversified away by investing in both Clime Investment 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 Clime Investment and Macquarie into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Clime Investment Management and Macquarie Group, you can compare the effects of market volatilities on Clime Investment 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 Clime Investment with a short position of Macquarie. Check out your portfolio center. Please also check ongoing floating volatility patterns of Clime Investment and Macquarie.
Diversification Opportunities for Clime Investment and Macquarie
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Clime and Macquarie is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Clime Investment Management and Macquarie Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Macquarie Group and Clime Investment 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 Clime Investment Management 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 Clime Investment i.e., Clime Investment and Macquarie go up and down completely randomly.
Pair Corralation between Clime Investment and Macquarie
Assuming the 90 days trading horizon Clime Investment Management is expected to generate 2.08 times more return on investment than Macquarie. However, Clime Investment is 2.08 times more volatile than Macquarie Group. It trades about 0.07 of its potential returns per unit of risk. Macquarie Group is currently generating about -0.14 per unit of risk. If you would invest 35.00 in Clime Investment Management on September 26, 2024 and sell it today you would earn a total of 1.00 from holding Clime Investment Management or generate 2.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Clime Investment Management vs. Macquarie Group
Performance |
| Timeline |
| Clime Investment Man |
| Macquarie Group |
Clime Investment and Macquarie Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Clime Investment and Macquarie
The main advantage of trading using opposite Clime Investment and Macquarie positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Clime Investment 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.| Clime Investment vs. Qbe Insurance Group | Clime Investment vs. Ainsworth Game Technology | Clime Investment vs. Commonwealth Bank of | Clime Investment vs. Bell Financial Group |
| Macquarie vs. Westpac Banking | Macquarie vs. Ecofibre | Macquarie vs. iShares Global Healthcare | Macquarie vs. Adriatic Metals Plc |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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