Correlation Between Platinum Asset and Magellan Financial
Can any of the company-specific risk be diversified away by investing in both Platinum Asset and Magellan 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 Platinum Asset and Magellan Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Platinum Asset Management and Magellan Financial Group, you can compare the effects of market volatilities on Platinum Asset and Magellan 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 Platinum Asset with a short position of Magellan Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Platinum Asset and Magellan Financial.
Diversification Opportunities for Platinum Asset and Magellan Financial
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Platinum and Magellan is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Platinum Asset Management and Magellan Financial Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Magellan Financial and Platinum Asset 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 Platinum Asset Management are associated (or correlated) with Magellan Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Magellan Financial has no effect on the direction of Platinum Asset i.e., Platinum Asset and Magellan Financial go up and down completely randomly.
Pair Corralation between Platinum Asset and Magellan Financial
Assuming the 90 days trading horizon Platinum Asset Management is expected to generate 1.4 times more return on investment than Magellan Financial. However, Platinum Asset is 1.4 times more volatile than Magellan Financial Group. It trades about 0.19 of its potential returns per unit of risk. Magellan Financial Group is currently generating about 0.12 per unit of risk. If you would invest 64.00 in Platinum Asset Management on October 21, 2024 and sell it today you would earn a total of 5.00 from holding Platinum Asset Management or generate 7.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Platinum Asset Management vs. Magellan Financial Group
Performance |
| Timeline |
| Platinum Asset Management |
| Magellan Financial |
Platinum Asset and Magellan Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Platinum Asset and Magellan Financial
The main advantage of trading using opposite Platinum Asset and Magellan Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Platinum Asset position performs unexpectedly, Magellan 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 Magellan Financial will offset losses from the drop in Magellan Financial's long position.| Platinum Asset vs. Ramsay Health Care | Platinum Asset vs. Epsilon Healthcare | Platinum Asset vs. Austco Healthcare | Platinum Asset vs. Peel Mining |
| Magellan Financial vs. ACDC Metals | Magellan Financial vs. Aeon Metals | Magellan Financial vs. DY6 Metals | Magellan Financial vs. Falcon Metals |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
Other Complementary Tools
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Transaction History View history of all your transactions and understand their impact on performance |