Correlation Between Centuria Industrial and Ironbark Capital
Can any of the company-specific risk be diversified away by investing in both Centuria Industrial and Ironbark Capital 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 Industrial and Ironbark Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Centuria Industrial Reit and Ironbark Capital, you can compare the effects of market volatilities on Centuria Industrial and Ironbark Capital 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 Industrial with a short position of Ironbark Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Centuria Industrial and Ironbark Capital.
Diversification Opportunities for Centuria Industrial and Ironbark Capital
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Centuria and Ironbark is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Centuria Industrial Reit and Ironbark Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ironbark Capital and Centuria Industrial 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 Industrial Reit are associated (or correlated) with Ironbark Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ironbark Capital has no effect on the direction of Centuria Industrial i.e., Centuria Industrial and Ironbark Capital go up and down completely randomly.
Pair Corralation between Centuria Industrial and Ironbark Capital
Assuming the 90 days trading horizon Centuria Industrial Reit is expected to under-perform the Ironbark Capital. But the stock apears to be less risky and, when comparing its historical volatility, Centuria Industrial Reit is 1.13 times less risky than Ironbark Capital. The stock trades about -0.3 of its potential returns per unit of risk. The Ironbark Capital is currently generating about -0.12 of returns per unit of risk over similar time horizon. If you would invest 47.00 in Ironbark Capital on September 15, 2024 and sell it today you would lose (1.00) from holding Ironbark Capital or give up 2.13% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Centuria Industrial Reit vs. Ironbark Capital
Performance |
| Timeline |
| Centuria Industrial Reit |
| Ironbark Capital |
Centuria Industrial and Ironbark Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Centuria Industrial and Ironbark Capital
The main advantage of trading using opposite Centuria Industrial and Ironbark Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Centuria Industrial position performs unexpectedly, Ironbark Capital 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 Ironbark Capital will offset losses from the drop in Ironbark Capital's long position.| Centuria Industrial vs. Infomedia | Centuria Industrial vs. TPG Telecom | Centuria Industrial vs. Bisalloy Steel Group | Centuria Industrial vs. Spirit Telecom |
| Ironbark Capital vs. Centuria Industrial Reit | Ironbark Capital vs. EROAD | Ironbark Capital vs. Aurelia Metals | Ironbark Capital vs. Dalaroo 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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