Correlation Between Macquarie and EVE Health

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

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

Diversification Opportunities for Macquarie and EVE Health

-0.7

Correlation Coefficient

Macquarie  EVE Health

Excellent diversification

The 3 months correlation between Macquarie and EVE is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Macquarie Group and EVE Health Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EVE Health Group and Macquarie 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 Group are associated (or correlated) with EVE Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EVE Health Group has no effect on the direction of Macquarie i.e., Macquarie and EVE Health go up and down completely randomly.

Pair Corralation between Macquarie and EVE Health

Assuming the 90 days trading horizon Macquarie Group is expected to generate 0.21 times more return on investment than EVE Health. However, Macquarie Group is 4.66 times less risky than EVE Health. It trades about 0.2 of its potential returns per unit of risk. EVE Health Group is currently generating about 0.0 per unit of risk. If you would invest  18,936  in Macquarie Group on April 25, 2025 and sell it today you would earn a total of  3,593  from holding Macquarie Group or generate 18.97% return on investment over 90 days.

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

Macquarie Group  vs.  EVE Health Group

Macquarie Group

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Macquarie Group are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain technical and fundamental indicators, Macquarie unveiled solid returns over the last few months and may actually be approaching a breakup point.

EVE Health Group

Risk-Adjusted Performance

Very Weak

Over the last 90 days EVE Health Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable technical and fundamental indicators, EVE Health 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 and EVE Health

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

The idea behind Macquarie Group and EVE Health Group 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..