Correlation Between Charter Hall and Hansen Technologies
Can any of the company-specific risk be diversified away by investing in both Charter Hall and Hansen Technologies 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 Charter Hall and Hansen Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Charter Hall Education and Hansen Technologies, you can compare the effects of market volatilities on Charter Hall and Hansen Technologies 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 Charter Hall with a short position of Hansen Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Charter Hall and Hansen Technologies.
Diversification Opportunities for Charter Hall and Hansen Technologies
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Charter and Hansen is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Charter Hall Education and Hansen Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hansen Technologies and Charter Hall 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 Charter Hall Education are associated (or correlated) with Hansen Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hansen Technologies has no effect on the direction of Charter Hall i.e., Charter Hall and Hansen Technologies go up and down completely randomly.
Pair Corralation between Charter Hall and Hansen Technologies
Assuming the 90 days trading horizon Charter Hall Education is expected to generate 1.14 times more return on investment than Hansen Technologies. However, Charter Hall is 1.14 times more volatile than Hansen Technologies. It trades about 0.13 of its potential returns per unit of risk. Hansen Technologies is currently generating about -0.12 per unit of risk. If you would invest 251.00 in Charter Hall Education on October 15, 2024 and sell it today you would earn a total of 6.00 from holding Charter Hall Education or generate 2.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Charter Hall Education vs. Hansen Technologies
Performance |
| Timeline |
| Charter Hall Education |
| Hansen Technologies |
Charter Hall and Hansen Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Charter Hall and Hansen Technologies
The main advantage of trading using opposite Charter Hall and Hansen Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Charter Hall position performs unexpectedly, Hansen Technologies 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 Hansen Technologies will offset losses from the drop in Hansen Technologies' long position.| Charter Hall vs. Premier Investments | Charter Hall vs. Djerriwarrh Investments | Charter Hall vs. Flagship Investments | Charter Hall vs. Pinnacle Investment Management |
| Hansen Technologies vs. Charter Hall Education | Hansen Technologies vs. Carnegie Clean Energy | Hansen Technologies vs. Ramsay Health Care | Hansen Technologies vs. Global Health |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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