Correlation Between Macquarie Bank and Harris Technology
Can any of the company-specific risk be diversified away by investing in both Macquarie Bank and Harris 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 Harris 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 Harris Technology Group, you can compare the effects of market volatilities on Macquarie Bank and Harris 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 Harris Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Macquarie Bank and Harris Technology.
Diversification Opportunities for Macquarie Bank and Harris Technology
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Macquarie and Harris is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Macquarie Bank Limited and Harris Technology Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Harris 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 Harris Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Harris Technology has no effect on the direction of Macquarie Bank i.e., Macquarie Bank and Harris Technology go up and down completely randomly.
Pair Corralation between Macquarie Bank and Harris Technology
Assuming the 90 days trading horizon Macquarie Bank is expected to generate 33.97 times less return on investment than Harris Technology. But when comparing it to its historical volatility, Macquarie Bank Limited is 11.24 times less risky than Harris Technology. It trades about 0.02 of its potential returns per unit of risk. Harris Technology Group is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 1.00 in Harris Technology Group on September 13, 2024 and sell it today you would earn a total of 0.10 from holding Harris Technology Group or generate 10.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Macquarie Bank Limited vs. Harris Technology Group
Performance |
| Timeline |
| Macquarie Bank |
| Harris Technology |
Macquarie Bank and Harris Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Macquarie Bank and Harris Technology
The main advantage of trading using opposite Macquarie Bank and Harris Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Macquarie Bank position performs unexpectedly, Harris 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 Harris Technology will offset losses from the drop in Harris Technology's long position.| Macquarie Bank vs. Ssr Mining | Macquarie Bank vs. Ora Banda Mining | Macquarie Bank vs. Polymetals Resources | Macquarie Bank vs. Ecofibre |
| Harris Technology vs. Perseus Mining | Harris Technology vs. Falcon Metals | Harris Technology vs. Macquarie Bank Limited | Harris Technology vs. Magellan Financial Group |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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