Correlation Between Magellan Financial and Althea Group
Can any of the company-specific risk be diversified away by investing in both Magellan Financial and Althea Group 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 Magellan Financial and Althea Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Magellan Financial Group and Althea Group Holdings, you can compare the effects of market volatilities on Magellan Financial and Althea Group 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 Magellan Financial with a short position of Althea Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Magellan Financial and Althea Group.
Diversification Opportunities for Magellan Financial and Althea Group
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Magellan and Althea is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Magellan Financial Group and Althea Group Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Althea Group Holdings and Magellan Financial 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 Magellan Financial Group are associated (or correlated) with Althea Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Althea Group Holdings has no effect on the direction of Magellan Financial i.e., Magellan Financial and Althea Group go up and down completely randomly.
Pair Corralation between Magellan Financial and Althea Group
If you would invest 1,103 in Magellan Financial Group on November 2, 2024 and sell it today you would earn a total of 35.00 from holding Magellan Financial Group or generate 3.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Magellan Financial Group vs. Althea Group Holdings
Performance |
| Timeline |
| Magellan Financial |
| Althea Group Holdings |
Magellan Financial and Althea Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Magellan Financial and Althea Group
The main advantage of trading using opposite Magellan Financial and Althea Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Magellan Financial position performs unexpectedly, Althea Group 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 Althea Group will offset losses from the drop in Althea Group's long position.| Magellan Financial vs. Hutchison Telecommunications | Magellan Financial vs. Ainsworth Game Technology | Magellan Financial vs. Aeon Metals | Magellan Financial vs. Sky Metals |
| Althea Group vs. Super Retail Group | Althea Group vs. Liberty Financial Group | Althea Group vs. Magellan Financial Group | Althea Group vs. Retail Food 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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