Correlation Between Macys and AVEVA Group
Can any of the company-specific risk be diversified away by investing in both Macys and AVEVA Group 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 Macys and AVEVA Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Macys Inc and AVEVA Group PLC, you can compare the effects of market volatilities on Macys and AVEVA Group 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 Macys with a short position of AVEVA Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Macys and AVEVA Group.
Diversification Opportunities for Macys and AVEVA Group
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Macys and AVEVA is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Macys Inc and AVEVA Group PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AVEVA Group PLC and Macys 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 Macys Inc are associated (or correlated) with AVEVA Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AVEVA Group PLC has no effect on the direction of Macys i.e., Macys and AVEVA Group go up and down completely randomly.
Pair Corralation between Macys and AVEVA Group
If you would invest 1,914 in Macys Inc on January 26, 2024 and sell it today you would lose (41.00) from holding Macys Inc or give up 2.14% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 2.38% |
| Values | Daily Returns |
Macys Inc vs. AVEVA Group PLC
Performance |
| Timeline |
| Macys Inc |
| AVEVA Group PLC |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Macys and AVEVA Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Macys and AVEVA Group
The main advantage of trading using opposite Macys and AVEVA Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Macys position performs unexpectedly, AVEVA Group 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 AVEVA Group will offset losses from the drop in AVEVA Group's long position.| Macys vs. Marks Spencer Group | Macys vs. Marks and Spencer | Macys vs. Dillards Capital Trust | Macys vs. Companhia Brasileira de |
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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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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