Correlation Between Eversource Energy and Macys
Can any of the company-specific risk be diversified away by investing in both Eversource Energy and Macys 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 Eversource Energy and Macys into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eversource Energy and Macys Inc, you can compare the effects of market volatilities on Eversource Energy and Macys 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 Eversource Energy with a short position of Macys. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eversource Energy and Macys.
Diversification Opportunities for Eversource Energy and Macys
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Eversource and Macys is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Eversource Energy and Macys Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Macys Inc and Eversource Energy 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 Eversource Energy are associated (or correlated) with Macys. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Macys Inc has no effect on the direction of Eversource Energy i.e., Eversource Energy and Macys go up and down completely randomly.
Pair Corralation between Eversource Energy and Macys
Allowing for the 90-day total investment horizon Eversource Energy is expected to under-perform the Macys. But the stock apears to be less risky and, when comparing its historical volatility, Eversource Energy is 2.02 times less risky than Macys. The stock trades about -0.03 of its potential returns per unit of risk. The Macys Inc is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 1,758 in Macys Inc on January 25, 2024 and sell it today you would earn a total of 115.00 from holding Macys Inc or generate 6.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eversource Energy vs. Macys Inc
Performance |
| Timeline |
| Eversource Energy |
| Macys Inc |
Eversource Energy and Macys Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eversource Energy and Macys
The main advantage of trading using opposite Eversource Energy and Macys positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eversource Energy position performs unexpectedly, Macys 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 Macys will offset losses from the drop in Macys' long position.| Eversource Energy vs. CenterPoint Energy | Eversource Energy vs. FirstEnergy | Eversource Energy vs. Pinnacle West Capital | Eversource Energy vs. Edison International |
| Macys vs. Marks Spencer Group | Macys vs. Marks and Spencer | Macys vs. Dillards Capital Trust | Macys vs. Companhia Brasileira de |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
Other Complementary Tools
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| AI Investment Finder Use AI to screen and filter profitable investment opportunities | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios |