Correlation Between Macquarie Bank and Dug Technology
Can any of the company-specific risk be diversified away by investing in both Macquarie Bank and Dug Technology 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 Bank and Dug Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Macquarie Bank Limited and Dug Technology, you can compare the effects of market volatilities on Macquarie Bank and Dug Technology 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 Bank with a short position of Dug Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Macquarie Bank and Dug Technology.
Diversification Opportunities for Macquarie Bank and Dug Technology
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Macquarie and Dug is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Macquarie Bank Limited and Dug Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dug Technology and Macquarie Bank 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 Bank Limited are associated (or correlated) with Dug Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dug Technology has no effect on the direction of Macquarie Bank i.e., Macquarie Bank and Dug Technology go up and down completely randomly.
Pair Corralation between Macquarie Bank and Dug Technology
Assuming the 90 days trading horizon Macquarie Bank Limited is expected to generate 0.15 times more return on investment than Dug Technology. However, Macquarie Bank Limited is 6.45 times less risky than Dug Technology. It trades about 0.08 of its potential returns per unit of risk. Dug Technology is currently generating about -0.14 per unit of risk. If you would invest 9,842 in Macquarie Bank Limited on October 17, 2024 and sell it today you would earn a total of 558.00 from holding Macquarie Bank Limited or generate 5.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Macquarie Bank Limited vs. Dug Technology
Performance |
| Timeline |
| Macquarie Bank |
| Dug Technology |
Macquarie Bank and Dug Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Macquarie Bank and Dug Technology
The main advantage of trading using opposite Macquarie Bank and Dug Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Macquarie Bank position performs unexpectedly, Dug Technology 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 Dug Technology will offset losses from the drop in Dug Technology's long position.| Macquarie Bank vs. Oneview Healthcare PLC | Macquarie Bank vs. Andean Silver Limited | Macquarie Bank vs. Aspire Mining | Macquarie Bank vs. Qbe Insurance Group |
| Dug Technology vs. Commonwealth Bank of | Dug Technology vs. Flagship Investments | Dug Technology vs. Macquarie Bank Limited | Dug Technology vs. Auctus Alternative Investments |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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