Correlation Between Macquarie Global and Lmp Capital

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

By analyzing existing cross correlation between Macquarie Global Infrastructure and Lmp Capital And, you can compare the effects of market volatilities on Macquarie Global and Lmp Capital 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 Global with a short position of Lmp Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Macquarie Global and Lmp Capital.

Diversification Opportunities for Macquarie Global and Lmp Capital

0.17

Correlation Coefficient

Macquarie Global  Lmp Capital

Average diversification

The 3 months correlation between Macquarie and Lmp is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Macquarie Global Infrastructur and Lmp Capital And in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lmp Capital And and Macquarie Global 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 Global Infrastructure are associated (or correlated) with Lmp Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lmp Capital And has no effect on the direction of Macquarie Global i.e., Macquarie Global and Lmp Capital go up and down completely randomly.

Pair Corralation between Macquarie Global and Lmp Capital

If you would invest  1,491  in Lmp Capital And on October 22, 2024 and sell it today you would earn a total of  249.00  from holding Lmp Capital And or generate 16.7% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	0.81%
Values	Daily Returns

Macquarie Global Infrastructur  vs.  Lmp Capital And

Macquarie Global Inf

Risk-Adjusted Performance

0 of 100

Very Weak

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

Lmp Capital And

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Lmp Capital And are ranked lower than 3 (%) of all funds and portfolios of funds over the last 90 days. In spite of rather sound fundamental indicators, Lmp Capital is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Macquarie Global and Lmp Capital

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

The idea behind Macquarie Global Infrastructure and Lmp Capital And 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .