Correlation Between Macquarie Technology and GDI Property
Can any of the company-specific risk be diversified away by investing in both Macquarie Technology and GDI Property 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 Technology and GDI Property into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Macquarie Technology Group and GDI Property Group, you can compare the effects of market volatilities on Macquarie Technology and GDI Property 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 Technology with a short position of GDI Property. Check out your portfolio center. Please also check ongoing floating volatility patterns of Macquarie Technology and GDI Property.
Diversification Opportunities for Macquarie Technology and GDI Property
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Macquarie and GDI is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Macquarie Technology Group and GDI Property Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GDI Property Group and Macquarie Technology 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 Technology Group are associated (or correlated) with GDI Property. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GDI Property Group has no effect on the direction of Macquarie Technology i.e., Macquarie Technology and GDI Property go up and down completely randomly.
Pair Corralation between Macquarie Technology and GDI Property
Assuming the 90 days trading horizon Macquarie Technology Group is expected to under-perform the GDI Property. But the stock apears to be less risky and, when comparing its historical volatility, Macquarie Technology Group is 1.01 times less risky than GDI Property. The stock trades about -0.23 of its potential returns per unit of risk. The GDI Property Group is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 57.00 in GDI Property Group on December 1, 2024 and sell it today you would earn a total of 7.00 from holding GDI Property Group or generate 12.28% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Macquarie Technology Group vs. GDI Property Group
Performance |
Timeline |
Macquarie Technology |
GDI Property Group |
Macquarie Technology and GDI Property Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Macquarie Technology and GDI Property
The main advantage of trading using opposite Macquarie Technology and GDI Property positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Macquarie Technology position performs unexpectedly, GDI Property 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 GDI Property will offset losses from the drop in GDI Property's long position.Macquarie Technology vs. TPG Telecom | Macquarie Technology vs. Sports Entertainment Group | Macquarie Technology vs. Hotel Property Investments | Macquarie Technology vs. Truscott Mining Corp |
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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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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