Correlation Between Macquarie Technology and Morphic Ethical

Can any of the company-specific risk be diversified away by investing in both Macquarie Technology and Morphic Ethical 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 Morphic Ethical 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 Morphic Ethical Equities, you can compare the effects of market volatilities on Macquarie Technology and Morphic Ethical 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 Morphic Ethical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Macquarie Technology and Morphic Ethical.

Diversification Opportunities for Macquarie Technology and Morphic Ethical

0.77

Correlation Coefficient

Macquarie Technology  Morphic Ethical

Poor diversification

The 3 months correlation between Macquarie and Morphic is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Macquarie Technology Group and Morphic Ethical Equities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Morphic Ethical Equities 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 Morphic Ethical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Morphic Ethical Equities has no effect on the direction of Macquarie Technology i.e., Macquarie Technology and Morphic Ethical go up and down completely randomly.

Pair Corralation between Macquarie Technology and Morphic Ethical

Assuming the 90 days trading horizon Macquarie Technology is expected to generate 1.04 times less return on investment than Morphic Ethical. In addition to that, Macquarie Technology is 1.22 times more volatile than Morphic Ethical Equities. It trades about 0.13 of its total potential returns per unit of risk. Morphic Ethical Equities is currently generating about 0.17 per unit of volatility. If you would invest  99.00  in Morphic Ethical Equities on April 25, 2025 and sell it today you would earn a total of  16.00  from holding Morphic Ethical Equities or generate 16.16% return on investment over 90 days.

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

Macquarie Technology Group  vs.  Morphic Ethical Equities

Macquarie Technology

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Macquarie Technology Group are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Macquarie Technology unveiled solid returns over the last few months and may actually be approaching a breakup point.

Morphic Ethical Equities

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Morphic Ethical Equities are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain fundamental indicators, Morphic Ethical unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Macquarie Technology and Morphic Ethical

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

The idea behind Macquarie Technology Group and Morphic Ethical Equities 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.