Correlation Between Macmahon Holdings and Globex Mining
Can any of the company-specific risk be diversified away by investing in both Macmahon Holdings and Globex Mining 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 Macmahon Holdings and Globex Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Macmahon Holdings Limited and Globex Mining Enterprises, you can compare the effects of market volatilities on Macmahon Holdings and Globex Mining 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 Macmahon Holdings with a short position of Globex Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Macmahon Holdings and Globex Mining.
Diversification Opportunities for Macmahon Holdings and Globex Mining
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Macmahon and Globex is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Macmahon Holdings Limited and Globex Mining Enterprises in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Globex Mining Enterprises and Macmahon Holdings 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 Macmahon Holdings Limited are associated (or correlated) with Globex Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Globex Mining Enterprises has no effect on the direction of Macmahon Holdings i.e., Macmahon Holdings and Globex Mining go up and down completely randomly.
Pair Corralation between Macmahon Holdings and Globex Mining
Assuming the 90 days horizon Macmahon Holdings Limited is expected to generate 2.17 times more return on investment than Globex Mining. However, Macmahon Holdings is 2.17 times more volatile than Globex Mining Enterprises. It trades about 0.13 of its potential returns per unit of risk. Globex Mining Enterprises is currently generating about 0.06 per unit of risk. If you would invest 8.79 in Macmahon Holdings Limited on December 4, 2024 and sell it today you would earn a total of 11.21 from holding Macmahon Holdings Limited or generate 127.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 28.19% |
| Values | Daily Returns |
Macmahon Holdings Limited vs. Globex Mining Enterprises
Performance |
| Timeline |
| Macmahon Holdings |
| Globex Mining Enterprises |
Macmahon Holdings and Globex Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Macmahon Holdings and Globex Mining
The main advantage of trading using opposite Macmahon Holdings and Globex Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Macmahon Holdings position performs unexpectedly, Globex Mining 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 Globex Mining will offset losses from the drop in Globex Mining's long position.| Macmahon Holdings vs. National CineMedia | Macmahon Holdings vs. Sphere Entertainment Co | Macmahon Holdings vs. ZW Data Action | Macmahon Holdings vs. Deluxe |
| Globex Mining vs. Atomic Minerals | Globex Mining vs. Mundoro Capital | Globex Mining vs. E79 Resources Corp | Globex Mining vs. Norra Metals Corp |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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