Correlation Between Carindale Property and Vicinity Centres
Can any of the company-specific risk be diversified away by investing in both Carindale Property and Vicinity Centres 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 Carindale Property and Vicinity Centres into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Carindale Property Trust and Vicinity Centres Re, you can compare the effects of market volatilities on Carindale Property and Vicinity Centres 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 Carindale Property with a short position of Vicinity Centres. Check out your portfolio center. Please also check ongoing floating volatility patterns of Carindale Property and Vicinity Centres.
Diversification Opportunities for Carindale Property and Vicinity Centres
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Carindale and Vicinity is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Carindale Property Trust and Vicinity Centres Re in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vicinity Centres and Carindale Property 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 Carindale Property Trust are associated (or correlated) with Vicinity Centres. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vicinity Centres has no effect on the direction of Carindale Property i.e., Carindale Property and Vicinity Centres go up and down completely randomly.
Pair Corralation between Carindale Property and Vicinity Centres
Assuming the 90 days trading horizon Carindale Property Trust is expected to generate 1.25 times more return on investment than Vicinity Centres. However, Carindale Property is 1.25 times more volatile than Vicinity Centres Re. It trades about -0.04 of its potential returns per unit of risk. Vicinity Centres Re is currently generating about -0.13 per unit of risk. If you would invest 470.00 in Carindale Property Trust on August 25, 2024 and sell it today you would lose (5.00) from holding Carindale Property Trust or give up 1.06% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Carindale Property Trust vs. Vicinity Centres Re
Performance |
| Timeline |
| Carindale Property Trust |
| Vicinity Centres |
Carindale Property and Vicinity Centres Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Carindale Property and Vicinity Centres
The main advantage of trading using opposite Carindale Property and Vicinity Centres positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Carindale Property position performs unexpectedly, Vicinity Centres 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 Vicinity Centres will offset losses from the drop in Vicinity Centres' long position.| Carindale Property vs. Scentre Group | Carindale Property vs. Vicinity Centres Re | Carindale Property vs. Cromwell Property Group | Carindale Property vs. GDI Property Group |
| Vicinity Centres vs. Kingsrose Mining | Vicinity Centres vs. EROAD | Vicinity Centres vs. My Foodie Box | Vicinity Centres vs. Alto 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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