Correlation Between Macquarie Technology and Whitefield Industrials

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

Diversification Opportunities for Macquarie Technology and Whitefield Industrials

0.61

Correlation Coefficient

Macquarie Technology  Whitefield Industrials

Poor diversification

The 3 months correlation between Macquarie and Whitefield is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Macquarie Technology Group and Whitefield Industrials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Whitefield Industrials 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 Whitefield Industrials. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Whitefield Industrials has no effect on the direction of Macquarie Technology i.e., Macquarie Technology and Whitefield Industrials go up and down completely randomly.

Pair Corralation between Macquarie Technology and Whitefield Industrials

Assuming the 90 days trading horizon Macquarie Technology Group is expected to generate 2.1 times more return on investment than Whitefield Industrials. However, Macquarie Technology is 2.1 times more volatile than Whitefield Industrials. It trades about 0.13 of its potential returns per unit of risk. Whitefield Industrials is currently generating about 0.08 per unit of risk. If you would invest  5,985  in Macquarie Technology Group on April 25, 2025 and sell it today you would earn a total of  901.00  from holding Macquarie Technology Group or generate 15.05% 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.  Whitefield Industrials

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.

Whitefield Industrials

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Whitefield Industrials are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable technical and fundamental indicators, Whitefield Industrials is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Macquarie Technology and Whitefield Industrials

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

The idea behind Macquarie Technology Group and Whitefield Industrials 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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.