Correlation Between Dicker Data and Macquarie
Can any of the company-specific risk be diversified away by investing in both Dicker Data 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 Dicker Data and Macquarie into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dicker Data and Macquarie Group, you can compare the effects of market volatilities on Dicker Data 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 Dicker Data with a short position of Macquarie. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dicker Data and Macquarie.
Diversification Opportunities for Dicker Data and Macquarie
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Dicker and Macquarie is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Dicker Data and Macquarie Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Macquarie Group and Dicker Data 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 Dicker Data 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 Dicker Data i.e., Dicker Data and Macquarie go up and down completely randomly.
Pair Corralation between Dicker Data and Macquarie
Assuming the 90 days trading horizon Dicker Data is expected to under-perform the Macquarie. In addition to that, Dicker Data is 1.19 times more volatile than Macquarie Group. It trades about -0.07 of its total potential returns per unit of risk. Macquarie Group is currently generating about 0.06 per unit of volatility. If you would invest 22,874 in Macquarie Group on August 31, 2024 and sell it today you would earn a total of 386.00 from holding Macquarie Group or generate 1.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Dicker Data vs. Macquarie Group
Performance |
| Timeline |
| Dicker Data |
| Macquarie Group |
Dicker Data and Macquarie Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dicker Data and Macquarie
The main advantage of trading using opposite Dicker Data and Macquarie positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dicker Data 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.| Dicker Data vs. Amani Gold | Dicker Data vs. A1 Investments Resources | Dicker Data vs. Coronado Global Resources | Dicker Data vs. Hutchison Telecommunications |
| Macquarie vs. Finexia Financial Group | Macquarie vs. Macquarie Bank Limited | Macquarie vs. Pioneer Credit | Macquarie vs. Talisman Mining |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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