Correlation Between Grand Vision and Macfarlane Group
Can any of the company-specific risk be diversified away by investing in both Grand Vision and Macfarlane 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 Grand Vision and Macfarlane Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grand Vision Media and Macfarlane Group PLC, you can compare the effects of market volatilities on Grand Vision and Macfarlane 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 Grand Vision with a short position of Macfarlane Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grand Vision and Macfarlane Group.
Diversification Opportunities for Grand Vision and Macfarlane Group
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Grand and Macfarlane is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Grand Vision Media and Macfarlane Group PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Macfarlane Group PLC and Grand Vision 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 Grand Vision Media are associated (or correlated) with Macfarlane Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Macfarlane Group PLC has no effect on the direction of Grand Vision i.e., Grand Vision and Macfarlane Group go up and down completely randomly.
Pair Corralation between Grand Vision and Macfarlane Group
Assuming the 90 days trading horizon Grand Vision Media is expected to under-perform the Macfarlane Group. In addition to that, Grand Vision is 1.72 times more volatile than Macfarlane Group PLC. It trades about -0.11 of its total potential returns per unit of risk. Macfarlane Group PLC is currently generating about -0.06 per unit of volatility. If you would invest 12,001 in Macfarlane Group PLC on September 3, 2024 and sell it today you would lose (1,501) from holding Macfarlane Group PLC or give up 12.51% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grand Vision Media vs. Macfarlane Group PLC
Performance |
| Timeline |
| Grand Vision Media |
| Macfarlane Group PLC |
Grand Vision and Macfarlane Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grand Vision and Macfarlane Group
The main advantage of trading using opposite Grand Vision and Macfarlane Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grand Vision position performs unexpectedly, Macfarlane 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 Macfarlane Group will offset losses from the drop in Macfarlane Group's long position.| Grand Vision vs. Universal Display Corp | Grand Vision vs. Universal Health Services | Grand Vision vs. HCA Healthcare | Grand Vision vs. Inspiration Healthcare Group |
| Macfarlane Group vs. Lundin Mining Corp | Macfarlane Group vs. Anglesey Mining | Macfarlane Group vs. Abingdon Health Plc | Macfarlane Group vs. Worldwide Healthcare Trust |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
Other Complementary Tools
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments |