Correlation Between Macquarie Technology and Srj Technologies
Can any of the company-specific risk be diversified away by investing in both Macquarie Technology and Srj Technologies 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 Srj Technologies 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 Srj Technologies Group, you can compare the effects of market volatilities on Macquarie Technology and Srj Technologies 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 Srj Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Macquarie Technology and Srj Technologies.
Diversification Opportunities for Macquarie Technology and Srj Technologies
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Macquarie and Srj is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Macquarie Technology Group and Srj Technologies Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Srj Technologies 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 Srj Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Srj Technologies has no effect on the direction of Macquarie Technology i.e., Macquarie Technology and Srj Technologies go up and down completely randomly.
Pair Corralation between Macquarie Technology and Srj Technologies
Assuming the 90 days trading horizon Macquarie Technology Group is expected to generate 0.28 times more return on investment than Srj Technologies. However, Macquarie Technology Group is 3.63 times less risky than Srj Technologies. It trades about 0.16 of its potential returns per unit of risk. Srj Technologies Group is currently generating about -0.12 per unit of risk. If you would invest 8,240 in Macquarie Technology Group on August 30, 2024 and sell it today you would earn a total of 389.00 from holding Macquarie Technology Group or generate 4.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Macquarie Technology Group vs. Srj Technologies Group
Performance |
| Timeline |
| Macquarie Technology |
| Srj Technologies |
Macquarie Technology and Srj Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Macquarie Technology and Srj Technologies
The main advantage of trading using opposite Macquarie Technology and Srj Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Macquarie Technology position performs unexpectedly, Srj Technologies 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 Srj Technologies will offset losses from the drop in Srj Technologies' long position.| Macquarie Technology vs. Tlou Energy | Macquarie Technology vs. Encounter Resources | Macquarie Technology vs. Southern Cross Gold | Macquarie Technology vs. Minbos Resources |
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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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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