Correlation Between McDonalds Corp and Macys

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both McDonalds Corp 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 McDonalds Corp and Macys into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between McDonalds Corp and Macys Inc, you can compare the effects of market volatilities on McDonalds Corp 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 McDonalds Corp with a short position of Macys. Check out your portfolio center. Please also check ongoing floating volatility patterns of McDonalds Corp and Macys.

Diversification Opportunities for McDonalds Corp and Macys

0.18
  Correlation Coefficient

Average diversification

The 3 months correlation between McDonalds and Macys is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding McDonalds Corp and Macys Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Macys Inc and McDonalds Corp 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 McDonalds Corp 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 McDonalds Corp i.e., McDonalds Corp and Macys go up and down completely randomly.

Pair Corralation between McDonalds Corp and Macys

Considering the 90-day investment horizon McDonalds Corp is expected to generate 0.42 times more return on investment than Macys. However, McDonalds Corp is 2.41 times less risky than Macys. It trades about -0.17 of its potential returns per unit of risk. Macys Inc is currently generating about -0.3 per unit of risk. If you would invest  25,555  in McDonalds Corp on June 27, 2022 and sell it today you would lose (960.00)  from holding McDonalds Corp or give up 3.76% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

McDonalds Corp  vs.  Macys Inc

 Performance (%) 
       Timeline  
McDonalds Corp 
McDonalds Performance
0 of 100
Over the last 90 days McDonalds Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound fundamental indicators, McDonalds Corp is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

McDonalds Price Channel

Macys Inc 
Macys Performance
0 of 100
Over the last 90 days Macys Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's primary indicators remain relatively steady which may send shares a bit higher in October 2022. The new chaos may also be a sign of medium-term up-swing for the company stakeholders.

Macys Price Channel

McDonalds Corp and Macys Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with McDonalds Corp and Macys

The main advantage of trading using opposite McDonalds Corp and Macys positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if McDonalds Corp 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.
McDonalds Corp vs. Industrias Bachoco SA
The idea behind McDonalds Corp and Macys Inc 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.
Macys vs. Industrias Bachoco SA
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.

Other Complementary Tools

Insider Screener
Find insiders across different sectors to evaluate their impact on performance
Go
Pattern Recognition
Use different Pattern Recognition models to time the market across multiple global exchanges
Go
Premium Stories
Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope
Go
Bond Analysis
Evaluate and analyze corporate bonds as a potential investment for your portfolios.
Go
Cryptocurrency Center
Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency
Go
Equity Forecasting
Use basic forecasting models to generate price predictions and determine price momentum
Go
Positions Ratings
Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance
Go
Global Markets Map
Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes
Go
Price Ceiling Movement
Calculate and plot Price Ceiling Movement for different equity instruments
Go
Stock Screener
Find equities using custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook.
Go