Correlation Between SupplyMe Capital and Macfarlane Group
Can any of the company-specific risk be diversified away by investing in both SupplyMe Capital and Macfarlane 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 SupplyMe Capital and Macfarlane Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SupplyMe Capital PLC and Macfarlane Group PLC, you can compare the effects of market volatilities on SupplyMe Capital and Macfarlane 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 SupplyMe Capital with a short position of Macfarlane Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of SupplyMe Capital and Macfarlane Group.
Diversification Opportunities for SupplyMe Capital and Macfarlane Group
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between SupplyMe and Macfarlane is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding SupplyMe Capital PLC and Macfarlane Group PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Macfarlane Group PLC and SupplyMe Capital 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 SupplyMe Capital PLC are associated (or correlated) with Macfarlane Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Macfarlane Group PLC has no effect on the direction of SupplyMe Capital i.e., SupplyMe Capital and Macfarlane Group go up and down completely randomly.
Pair Corralation between SupplyMe Capital and Macfarlane Group
Assuming the 90 days trading horizon SupplyMe Capital PLC is expected to under-perform the Macfarlane Group. In addition to that, SupplyMe Capital is 6.05 times more volatile than Macfarlane Group PLC. It trades about -0.09 of its total potential returns per unit of risk. Macfarlane Group PLC is currently generating about -0.06 per unit of volatility. If you would invest 12,001 in Macfarlane Group PLC on September 3, 2024 and sell it today you would lose (1,501) from holding Macfarlane Group PLC or give up 12.51% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SupplyMe Capital PLC vs. Macfarlane Group PLC
Performance |
| Timeline |
| SupplyMe Capital PLC |
| Macfarlane Group PLC |
SupplyMe Capital and Macfarlane Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SupplyMe Capital and Macfarlane Group
The main advantage of trading using opposite SupplyMe Capital and Macfarlane Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SupplyMe Capital position performs unexpectedly, Macfarlane 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 Macfarlane Group will offset losses from the drop in Macfarlane Group's long position.| SupplyMe Capital vs. Team Internet Group | SupplyMe Capital vs. Melia Hotels | SupplyMe Capital vs. PureTech Health plc | SupplyMe Capital vs. Charter Communications Cl |
| Macfarlane Group vs. Lundin Mining Corp | Macfarlane Group vs. Anglesey Mining | Macfarlane Group vs. Abingdon Health Plc | Macfarlane Group vs. Worldwide Healthcare Trust |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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