Correlation Between My Foodie and Macquarie Bank Ltd

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

By analyzing existing cross correlation between My Foodie Box and Macquarie Bank Ltd, you can compare the effects of market volatilities on My Foodie and Macquarie Bank Ltd 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 My Foodie with a short position of Macquarie Bank Ltd. Check out your portfolio center. Please also check ongoing floating volatility patterns of My Foodie and Macquarie Bank Ltd.

Diversification Opportunities for My Foodie and Macquarie Bank Ltd

0.0

Correlation Coefficient

My Foodie  Macquarie Bank Ltd

Pay attention - limited upside

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

Pair Corralation between My Foodie and Macquarie Bank Ltd

If you would invest (100.00) in Macquarie Bank Ltd on December 22, 2024 and sell it today you would earn a total of  100.00  from holding Macquarie Bank Ltd or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

My Foodie Box  vs.  Macquarie Bank Ltd

My Foodie Box

Risk-Adjusted Performance

Very Weak

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

Macquarie Bank Ltd

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Macquarie Bank Ltd are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Macquarie Bank Ltd is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with My Foodie and Macquarie Bank Ltd

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

The idea behind My Foodie Box and Macquarie Bank Ltd 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.