Correlation Between Maggie Beer and Liberty Financial
Can any of the company-specific risk be diversified away by investing in both Maggie Beer and Liberty Financial 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 Maggie Beer and Liberty Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Maggie Beer Holdings and Liberty Financial Group, you can compare the effects of market volatilities on Maggie Beer and Liberty Financial 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 Maggie Beer with a short position of Liberty Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Maggie Beer and Liberty Financial.
Diversification Opportunities for Maggie Beer and Liberty Financial
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between Maggie and Liberty is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Maggie Beer Holdings and Liberty Financial Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Liberty Financial and Maggie Beer 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 Maggie Beer Holdings are associated (or correlated) with Liberty Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Liberty Financial has no effect on the direction of Maggie Beer i.e., Maggie Beer and Liberty Financial go up and down completely randomly.
Pair Corralation between Maggie Beer and Liberty Financial
Assuming the 90 days trading horizon Maggie Beer is expected to generate 3.82 times less return on investment than Liberty Financial. In addition to that, Maggie Beer is 1.88 times more volatile than Liberty Financial Group. It trades about 0.04 of its total potential returns per unit of risk. Liberty Financial Group is currently generating about 0.3 per unit of volatility. If you would invest 325.00 in Liberty Financial Group on October 28, 2024 and sell it today you would earn a total of 37.00 from holding Liberty Financial Group or generate 11.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Maggie Beer Holdings vs. Liberty Financial Group
Performance |
| Timeline |
| Maggie Beer Holdings |
| Liberty Financial |
Maggie Beer and Liberty Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Maggie Beer and Liberty Financial
The main advantage of trading using opposite Maggie Beer and Liberty Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Maggie Beer position performs unexpectedly, Liberty Financial 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 Liberty Financial will offset losses from the drop in Liberty Financial's long position.| Maggie Beer vs. Vitura Health Limited | Maggie Beer vs. Apiam Animal Health | Maggie Beer vs. Epsilon Healthcare | Maggie Beer vs. ACDC Metals |
| Liberty Financial vs. Kip McGrath Education | Liberty Financial vs. Step One Clothing | Liberty Financial vs. Ora Banda Mining | Liberty Financial vs. MetalsGrove Mining |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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