Correlation Between Maximus and Brambles

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

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

Diversification Opportunities for Maximus and Brambles

0.06

Correlation Coefficient

Maximus  Brambles

Significant diversification

The 3 months correlation between Maximus and Brambles is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Maximus and Brambles Ltd ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brambles ADR and Maximus 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 Maximus are associated (or correlated) with Brambles. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brambles ADR has no effect on the direction of Maximus i.e., Maximus and Brambles go up and down completely randomly.

Pair Corralation between Maximus and Brambles

Considering the 90-day investment horizon Maximus is expected to generate 1.91 times more return on investment than Brambles. However, Maximus is 1.91 times more volatile than Brambles Ltd ADR. It trades about 0.09 of its potential returns per unit of risk. Brambles Ltd ADR is currently generating about 0.17 per unit of risk. If you would invest  6,689  in Maximus on May 7, 2025 and sell it today you would earn a total of  800.00  from holding Maximus or generate 11.96% return on investment over 90 days.

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

Maximus  vs.  Brambles Ltd ADR

Maximus

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Maximus are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain primary indicators, Maximus unveiled solid returns over the last few months and may actually be approaching a breakup point.

Brambles ADR

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Brambles Ltd ADR are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of fairly inconsistent essential indicators, Brambles may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with Maximus and Brambles

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

The idea behind Maximus and Brambles Ltd ADR 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.