Correlation Between Aurelia Metals and Macquarie Technology

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

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

Diversification Opportunities for Aurelia Metals and Macquarie Technology

-0.79

Correlation Coefficient

Aurelia Metals  Macquarie Technology

Pay attention - limited upside

The 3 months correlation between Aurelia and Macquarie is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding Aurelia Metals and Macquarie Technology Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Macquarie Technology and Aurelia Metals 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 Aurelia Metals are associated (or correlated) with Macquarie Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Macquarie Technology has no effect on the direction of Aurelia Metals i.e., Aurelia Metals and Macquarie Technology go up and down completely randomly.

Pair Corralation between Aurelia Metals and Macquarie Technology

Assuming the 90 days trading horizon Aurelia Metals is expected to generate 2.63 times more return on investment than Macquarie Technology. However, Aurelia Metals is 2.63 times more volatile than Macquarie Technology Group. It trades about 0.18 of its potential returns per unit of risk. Macquarie Technology Group is currently generating about -0.31 per unit of risk. If you would invest  17.00  in Aurelia Metals on December 31, 2024 and sell it today you would earn a total of  9.00  from holding Aurelia Metals or generate 52.94% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Aurelia Metals  vs.  Macquarie Technology Group

Aurelia Metals

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Aurelia Metals are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain forward indicators, Aurelia Metals unveiled solid returns over the last few months and may actually be approaching a breakup point.

Macquarie Technology

Risk-Adjusted Performance

Very Weak

Over the last 90 days Macquarie Technology Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in May 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Aurelia Metals and Macquarie Technology

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

The idea behind Aurelia Metals and Macquarie Technology Group 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.

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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 Stocks Directory module to find actively traded stocks across global markets.