Correlation Between Charter Hall and Garda Diversified
Can any of the company-specific risk be diversified away by investing in both Charter Hall and Garda Diversified 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 Garda Diversified 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 Garda Diversified Ppty, you can compare the effects of market volatilities on Charter Hall and Garda Diversified 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 Garda Diversified. Check out your portfolio center. Please also check ongoing floating volatility patterns of Charter Hall and Garda Diversified.
Diversification Opportunities for Charter Hall and Garda Diversified
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Charter and Garda is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Charter Hall Retail and Garda Diversified Ppty in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Garda Diversified Ppty 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 Garda Diversified. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Garda Diversified Ppty has no effect on the direction of Charter Hall i.e., Charter Hall and Garda Diversified go up and down completely randomly.
Pair Corralation between Charter Hall and Garda Diversified
Assuming the 90 days trading horizon Charter Hall Retail is expected to under-perform the Garda Diversified. But the stock apears to be less risky and, when comparing its historical volatility, Charter Hall Retail is 1.65 times less risky than Garda Diversified. The stock trades about -0.12 of its potential returns per unit of risk. The Garda Diversified Ppty is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 117.00 in Garda Diversified Ppty on August 28, 2024 and sell it today you would earn a total of 4.00 from holding Garda Diversified Ppty or generate 3.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Charter Hall Retail vs. Garda Diversified Ppty
Performance |
| Timeline |
| Charter Hall Retail |
| Garda Diversified Ppty |
Charter Hall and Garda Diversified Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Charter Hall and Garda Diversified
The main advantage of trading using opposite Charter Hall and Garda Diversified positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Charter Hall position performs unexpectedly, Garda Diversified 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 Garda Diversified will offset losses from the drop in Garda Diversified's long position.| Charter Hall vs. Cromwell Property Group | Charter Hall vs. GDI Property Group | Charter Hall vs. Australian Unity Office |
| Garda Diversified vs. Scentre Group | Garda Diversified vs. Vicinity Centres Re | Garda Diversified vs. Charter Hall Retail | Garda Diversified vs. Cromwell Property Group |
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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