Correlation Between CENTURIA OFFICE and NiSource
Can any of the company-specific risk be diversified away by investing in both CENTURIA OFFICE and NiSource 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 NiSource 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 NiSource, you can compare the effects of market volatilities on CENTURIA OFFICE and NiSource 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 NiSource. Check out your portfolio center. Please also check ongoing floating volatility patterns of CENTURIA OFFICE and NiSource.
Diversification Opportunities for CENTURIA OFFICE and NiSource
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between CENTURIA and NiSource is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding CENTURIA OFFICE REIT and NiSource in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NiSource 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 NiSource. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NiSource has no effect on the direction of CENTURIA OFFICE i.e., CENTURIA OFFICE and NiSource go up and down completely randomly.
Pair Corralation between CENTURIA OFFICE and NiSource
Assuming the 90 days horizon CENTURIA OFFICE is expected to generate 6.31 times less return on investment than NiSource. In addition to that, CENTURIA OFFICE is 1.08 times more volatile than NiSource. It trades about 0.06 of its total potential returns per unit of risk. NiSource is currently generating about 0.39 per unit of volatility. If you would invest 3,180 in NiSource on September 5, 2024 and sell it today you would earn a total of 340.00 from holding NiSource or generate 10.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
CENTURIA OFFICE REIT vs. NiSource
Performance |
| Timeline |
| CENTURIA OFFICE REIT |
| NiSource |
CENTURIA OFFICE and NiSource Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CENTURIA OFFICE and NiSource
The main advantage of trading using opposite CENTURIA OFFICE and NiSource positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CENTURIA OFFICE position performs unexpectedly, NiSource 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 NiSource will offset losses from the drop in NiSource's long position.| CENTURIA OFFICE vs. G III Apparel Group | CENTURIA OFFICE vs. MYFAIR GOLD P | CENTURIA OFFICE vs. TITANIUM TRANSPORTGROUP | CENTURIA OFFICE vs. NTG Nordic Transport |
| NiSource vs. MTI WIRELESS EDGE | NiSource vs. The Boston Beer | NiSource vs. Mobilezone Holding AG | NiSource vs. CENTURIA OFFICE REIT |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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