Correlation Between Charter Hall and Aspire Mining
Can any of the company-specific risk be diversified away by investing in both Charter Hall and Aspire Mining 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 Aspire Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Charter Hall Retail and Aspire Mining, you can compare the effects of market volatilities on Charter Hall and Aspire Mining 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 Aspire Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Charter Hall and Aspire Mining.
Diversification Opportunities for Charter Hall and Aspire Mining
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Charter and Aspire is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Charter Hall Retail and Aspire Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aspire Mining 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 Retail are associated (or correlated) with Aspire Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aspire Mining has no effect on the direction of Charter Hall i.e., Charter Hall and Aspire Mining go up and down completely randomly.
Pair Corralation between Charter Hall and Aspire Mining
Assuming the 90 days trading horizon Charter Hall is expected to generate 301.27 times less return on investment than Aspire Mining. But when comparing it to its historical volatility, Charter Hall Retail is 4.88 times less risky than Aspire Mining. It trades about 0.0 of its potential returns per unit of risk. Aspire Mining is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 7.90 in Aspire Mining on September 4, 2024 and sell it today you would earn a total of 22.10 from holding Aspire Mining or generate 279.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Charter Hall Retail vs. Aspire Mining
Performance |
| Timeline |
| Charter Hall Retail |
| Aspire Mining |
Charter Hall and Aspire Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Charter Hall and Aspire Mining
The main advantage of trading using opposite Charter Hall and Aspire Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Charter Hall position performs unexpectedly, Aspire Mining 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 Aspire Mining will offset losses from the drop in Aspire Mining's long position.| Charter Hall vs. Scentre Group | Charter Hall vs. Vicinity Centres Re | Charter Hall vs. Cromwell Property Group | Charter Hall vs. Carindale Property Trust |
| Aspire Mining vs. Westpac Banking | Aspire Mining vs. Microequities Asset Management | Aspire Mining vs. Steamships Trading | Aspire Mining vs. Argo Investments |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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