Correlation Between CENTURIA OFFICE and Hyundai
Can any of the company-specific risk be diversified away by investing in both CENTURIA OFFICE and Hyundai 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 CENTURIA OFFICE and Hyundai into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CENTURIA OFFICE REIT and Hyundai Motor, you can compare the effects of market volatilities on CENTURIA OFFICE and Hyundai 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 CENTURIA OFFICE with a short position of Hyundai. Check out your portfolio center. Please also check ongoing floating volatility patterns of CENTURIA OFFICE and Hyundai.
Diversification Opportunities for CENTURIA OFFICE and Hyundai
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between CENTURIA and Hyundai is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding CENTURIA OFFICE REIT and Hyundai Motor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hyundai Motor and CENTURIA OFFICE 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 CENTURIA OFFICE REIT are associated (or correlated) with Hyundai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hyundai Motor has no effect on the direction of CENTURIA OFFICE i.e., CENTURIA OFFICE and Hyundai go up and down completely randomly.
Pair Corralation between CENTURIA OFFICE and Hyundai
Assuming the 90 days horizon CENTURIA OFFICE REIT is expected to under-perform the Hyundai. But the stock apears to be less risky and, when comparing its historical volatility, CENTURIA OFFICE REIT is 2.02 times less risky than Hyundai. The stock trades about -0.15 of its potential returns per unit of risk. The Hyundai Motor is currently generating about -0.05 of returns per unit of risk over similar time horizon. If you would invest 5,360 in Hyundai Motor on August 25, 2024 and sell it today you would lose (180.00) from holding Hyundai Motor or give up 3.36% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CENTURIA OFFICE REIT vs. Hyundai Motor
Performance |
| Timeline |
| CENTURIA OFFICE REIT |
| Hyundai Motor |
CENTURIA OFFICE and Hyundai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CENTURIA OFFICE and Hyundai
The main advantage of trading using opposite CENTURIA OFFICE and Hyundai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CENTURIA OFFICE position performs unexpectedly, Hyundai 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 Hyundai will offset losses from the drop in Hyundai's long position.| CENTURIA OFFICE vs. Apple Inc | CENTURIA OFFICE vs. Apple Inc | CENTURIA OFFICE vs. Apple Inc | CENTURIA OFFICE vs. Apple Inc |
| Hyundai vs. VIVA WINE GROUP | Hyundai vs. CENTURIA OFFICE REIT | Hyundai vs. KENEDIX OFFICE INV | Hyundai vs. Lion One Metals |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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