Correlation Between Macquarie Technology and British Amer
Can any of the company-specific risk be diversified away by investing in both Macquarie Technology and British Amer 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 Macquarie Technology and British Amer into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Macquarie Technology Group and Bailador Technology Invest, you can compare the effects of market volatilities on Macquarie Technology and British Amer 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 Macquarie Technology with a short position of British Amer. Check out your portfolio center. Please also check ongoing floating volatility patterns of Macquarie Technology and British Amer.
Diversification Opportunities for Macquarie Technology and British Amer
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Macquarie and British is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Macquarie Technology Group and Bailador Technology Invest in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bailador Technology and Macquarie Technology 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 Macquarie Technology Group are associated (or correlated) with British Amer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bailador Technology has no effect on the direction of Macquarie Technology i.e., Macquarie Technology and British Amer go up and down completely randomly.
Pair Corralation between Macquarie Technology and British Amer
Assuming the 90 days trading horizon Macquarie Technology Group is expected to generate 1.42 times more return on investment than British Amer. However, Macquarie Technology is 1.42 times more volatile than Bailador Technology Invest. It trades about 0.05 of its potential returns per unit of risk. Bailador Technology Invest is currently generating about 0.02 per unit of risk. If you would invest 5,796 in Macquarie Technology Group on August 29, 2024 and sell it today you would earn a total of 2,833 from holding Macquarie Technology Group or generate 48.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Macquarie Technology Group vs. Bailador Technology Invest
Performance |
| Timeline |
| Macquarie Technology |
| Bailador Technology |
Macquarie Technology and British Amer Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Macquarie Technology and British Amer
The main advantage of trading using opposite Macquarie Technology and British Amer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Macquarie Technology position performs unexpectedly, British Amer 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 British Amer will offset losses from the drop in British Amer's long position.| Macquarie Technology vs. PVW Resources | Macquarie Technology vs. Woolworths | Macquarie Technology vs. Wesfarmers | Macquarie Technology vs. Coles Group |
| British Amer vs. Champion Iron | British Amer vs. Ridley | British Amer vs. Peel Mining | British Amer vs. Australian Dairy Farms |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
Other Complementary Tools
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital |