Correlation Between Coreshares Index and City Lodge
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By analyzing existing cross correlation between Coreshares Index Tracker and City Lodge Hotels, you can compare the effects of market volatilities on Coreshares Index and City Lodge 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 Coreshares Index with a short position of City Lodge. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coreshares Index and City Lodge.
Diversification Opportunities for Coreshares Index and City Lodge
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Coreshares and City is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Coreshares Index Tracker and City Lodge Hotels in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on City Lodge Hotels and Coreshares Index 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 Coreshares Index Tracker are associated (or correlated) with City Lodge. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of City Lodge Hotels has no effect on the direction of Coreshares Index i.e., Coreshares Index and City Lodge go up and down completely randomly.
Pair Corralation between Coreshares Index and City Lodge
Assuming the 90 days trading horizon Coreshares Index Tracker is expected to generate 0.52 times more return on investment than City Lodge. However, Coreshares Index Tracker is 1.9 times less risky than City Lodge. It trades about 0.03 of its potential returns per unit of risk. City Lodge Hotels is currently generating about 0.01 per unit of risk. If you would invest 99,741 in Coreshares Index Tracker on August 31, 2024 and sell it today you would earn a total of 8,259 from holding Coreshares Index Tracker or generate 8.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 90.32% |
| Values | Daily Returns |
Coreshares Index Tracker vs. City Lodge Hotels
Performance |
| Timeline |
| Coreshares Index Tracker |
| City Lodge Hotels |
Coreshares Index and City Lodge Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Coreshares Index and City Lodge
The main advantage of trading using opposite Coreshares Index and City Lodge positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coreshares Index position performs unexpectedly, City Lodge 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 City Lodge will offset losses from the drop in City Lodge's long position.| Coreshares Index vs. Europa Metals | Coreshares Index vs. JSE Limited | Coreshares Index vs. British American Tobacco | Coreshares Index vs. Kap Industrial Holdings |
| City Lodge vs. Astral Foods | City Lodge vs. Copper 360 | City Lodge vs. Harmony Gold Mining | City Lodge vs. RCL Foods |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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