Correlation Between Macquarie Technology and Qbe Insurance
Can any of the company-specific risk be diversified away by investing in both Macquarie Technology and Qbe Insurance 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 Qbe Insurance 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 Qbe Insurance Group, you can compare the effects of market volatilities on Macquarie Technology and Qbe Insurance 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 Qbe Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Macquarie Technology and Qbe Insurance.
Diversification Opportunities for Macquarie Technology and Qbe Insurance
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Macquarie and Qbe is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Macquarie Technology Group and Qbe Insurance Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Qbe Insurance Group 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 Qbe Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Qbe Insurance Group has no effect on the direction of Macquarie Technology i.e., Macquarie Technology and Qbe Insurance go up and down completely randomly.
Pair Corralation between Macquarie Technology and Qbe Insurance
Assuming the 90 days trading horizon Macquarie Technology Group is expected to under-perform the Qbe Insurance. In addition to that, Macquarie Technology is 1.63 times more volatile than Qbe Insurance Group. It trades about -0.1 of its total potential returns per unit of risk. Qbe Insurance Group is currently generating about 0.37 per unit of volatility. If you would invest 1,949 in Qbe Insurance Group on November 3, 2024 and sell it today you would earn a total of 145.00 from holding Qbe Insurance Group or generate 7.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Macquarie Technology Group vs. Qbe Insurance Group
Performance |
| Timeline |
| Macquarie Technology |
| Qbe Insurance Group |
Macquarie Technology and Qbe Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Macquarie Technology and Qbe Insurance
The main advantage of trading using opposite Macquarie Technology and Qbe Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Macquarie Technology position performs unexpectedly, Qbe Insurance 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 Qbe Insurance will offset losses from the drop in Qbe Insurance's long position.| Macquarie Technology vs. Mirrabooka Investments | Macquarie Technology vs. Navigator Global Investments | Macquarie Technology vs. Clime Investment Management | Macquarie Technology vs. Super Retail Group |
| Qbe Insurance vs. Aneka Tambang Tbk | Qbe Insurance vs. BHP Group Limited | Qbe Insurance vs. Ecofibre | Qbe Insurance vs. iShares Global Healthcare |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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