Correlation Between Mader Group and Maximus
Can any of the company-specific risk be diversified away by investing in both Mader Group and Maximus 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 Mader Group and Maximus into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mader Group Limited and Maximus, you can compare the effects of market volatilities on Mader Group and Maximus 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 Mader Group with a short position of Maximus. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mader Group and Maximus.
Diversification Opportunities for Mader Group and Maximus
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between Mader and Maximus is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Mader Group Limited and Maximus in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Maximus and Mader Group 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 Mader Group Limited are associated (or correlated) with Maximus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Maximus has no effect on the direction of Mader Group i.e., Mader Group and Maximus go up and down completely randomly.
Pair Corralation between Mader Group and Maximus
Assuming the 90 days horizon Mader Group Limited is expected to generate 1.89 times more return on investment than Maximus. However, Mader Group is 1.89 times more volatile than Maximus. It trades about 0.04 of its potential returns per unit of risk. Maximus is currently generating about 0.02 per unit of risk. If you would invest 249.00 in Mader Group Limited on October 21, 2024 and sell it today you would earn a total of 108.00 from holding Mader Group Limited or generate 43.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mader Group Limited vs. Maximus
Performance |
| Timeline |
| Mader Group Limited |
| Maximus |
Mader Group and Maximus Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mader Group and Maximus
The main advantage of trading using opposite Mader Group and Maximus positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mader Group position performs unexpectedly, Maximus 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 Maximus will offset losses from the drop in Maximus' long position.| Mader Group vs. Mako Mining Corp | Mader Group vs. Corsair Gaming | Mader Group vs. Mayfair Gold Corp | Mader Group vs. Cebu Air ADR |
| Maximus vs. Network 1 Technologies | Maximus vs. First Advantage Corp | Maximus vs. BrightView Holdings | Maximus vs. Civeo Corp |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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