Correlation Between Macys and Beyond,
Can any of the company-specific risk be diversified away by investing in both Macys and Beyond, 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 Macys and Beyond, into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Macys Inc and Beyond,, you can compare the effects of market volatilities on Macys and Beyond, 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 Macys with a short position of Beyond,. Check out your portfolio center. Please also check ongoing floating volatility patterns of Macys and Beyond,.
Diversification Opportunities for Macys and Beyond,
Very good diversification
The 3 months correlation between Macys and Beyond, is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Macys Inc and Beyond, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beyond, and Macys 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 Macys Inc are associated (or correlated) with Beyond,. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beyond, has no effect on the direction of Macys i.e., Macys and Beyond, go up and down completely randomly.
Pair Corralation between Macys and Beyond,
Taking into account the 90-day investment horizon Macys Inc is expected to generate 0.61 times more return on investment than Beyond,. However, Macys Inc is 1.65 times less risky than Beyond,. It trades about 0.02 of its potential returns per unit of risk. Beyond, is currently generating about -0.07 per unit of risk. If you would invest 1,549 in Macys Inc on September 12, 2024 and sell it today you would earn a total of 123.00 from holding Macys Inc or generate 7.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Macys Inc vs. Beyond,
Performance |
| Timeline |
| Macys Inc |
| Beyond, |
Macys and Beyond, Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Macys and Beyond,
The main advantage of trading using opposite Macys and Beyond, positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Macys position performs unexpectedly, Beyond, 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 Beyond, will offset losses from the drop in Beyond,'s long position.The idea behind Macys Inc and Beyond, pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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