Correlation Between Macquarie and British Amer

Can any of the company-specific risk be diversified away by investing in both Macquarie and British Amer 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 and British Amer into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Macquarie Group and Bailador Technology Invest, you can compare the effects of market volatilities on Macquarie and British Amer 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 with a short position of British Amer. Check out your portfolio center. Please also check ongoing floating volatility patterns of Macquarie and British Amer.

Diversification Opportunities for Macquarie and British Amer

0.0

Correlation Coefficient

Macquarie  British Amer

Pay attention - limited upside

The 3 months correlation between Macquarie and British is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Macquarie Group and Bailador Technology Invest in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bailador Technology and Macquarie 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 Group are associated (or correlated) with British Amer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bailador Technology has no effect on the direction of Macquarie i.e., Macquarie and British Amer go up and down completely randomly.

Pair Corralation between Macquarie and British Amer

Assuming the 90 days trading horizon Macquarie Group is expected to under-perform the British Amer. In addition to that, Macquarie is 1.13 times more volatile than Bailador Technology Invest. It trades about -0.05 of its total potential returns per unit of risk. Bailador Technology Invest is currently generating about 0.02 per unit of volatility. If you would invest  120.00  in Bailador Technology Invest on September 23, 2024 and sell it today you would earn a total of  1.00  from holding Bailador Technology Invest or generate 0.83% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Macquarie Group  vs.  Bailador Technology Invest

Macquarie Group

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Macquarie Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable technical and fundamental indicators, Macquarie is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Bailador Technology

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Bailador Technology Invest are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable forward indicators, British Amer is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Macquarie and British Amer

The main advantage of trading using opposite Macquarie and British Amer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Macquarie position performs unexpectedly, British Amer 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 British Amer will offset losses from the drop in British Amer's long position.

The idea behind Macquarie Group and Bailador Technology Invest pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.