Correlation Between Macquarie Technology and Healthco Healthcare
Can any of the company-specific risk be diversified away by investing in both Macquarie Technology and Healthco Healthcare 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 Healthco Healthcare 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 Healthco Healthcare and, you can compare the effects of market volatilities on Macquarie Technology and Healthco Healthcare 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 Healthco Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Macquarie Technology and Healthco Healthcare.
Diversification Opportunities for Macquarie Technology and Healthco Healthcare
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Macquarie and Healthco is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Macquarie Technology Group and Healthco Healthcare and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Healthco Healthcare and 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 Healthco Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Healthco Healthcare and has no effect on the direction of Macquarie Technology i.e., Macquarie Technology and Healthco Healthcare go up and down completely randomly.
Pair Corralation between Macquarie Technology and Healthco Healthcare
Assuming the 90 days trading horizon Macquarie Technology Group is expected to generate 1.04 times more return on investment than Healthco Healthcare. However, Macquarie Technology is 1.04 times more volatile than Healthco Healthcare and. It trades about 0.05 of its potential returns per unit of risk. Healthco Healthcare and is currently generating about -0.04 per unit of risk. If you would invest 5,910 in Macquarie Technology Group on September 24, 2024 and sell it today you would earn a total of 2,462 from holding Macquarie Technology Group or generate 41.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Macquarie Technology Group vs. Healthco Healthcare and
Performance |
| Timeline |
| Macquarie Technology |
| Healthco Healthcare and |
Macquarie Technology and Healthco Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Macquarie Technology and Healthco Healthcare
The main advantage of trading using opposite Macquarie Technology and Healthco Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Macquarie Technology position performs unexpectedly, Healthco Healthcare 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 Healthco Healthcare will offset losses from the drop in Healthco Healthcare's long position.| Macquarie Technology vs. Hutchison Telecommunications | Macquarie Technology vs. Australian Unity Office | Macquarie Technology vs. Prime Financial Group | Macquarie Technology vs. Kkr Credit Income |
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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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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