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 Retail 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
-0.77 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Charter and Hansen is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Charter Hall Retail 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 Retail 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 Retail is expected to under-perform the Hansen Technologies. But the stock apears to be less risky and, when comparing its historical volatility, Charter Hall Retail is 1.77 times less risky than Hansen Technologies. The stock trades about -0.15 of its potential returns per unit of risk. The Hansen Technologies is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 527.00 in Hansen Technologies on September 12, 2024 and sell it today you would earn a total of 10.00 from holding Hansen Technologies or generate 1.9% 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. Hansen Technologies
Performance |
| Timeline |
| Charter Hall Retail |
| 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. Falcon Metals | Charter Hall vs. Homeco Daily Needs | Charter Hall vs. Austco Healthcare | Charter Hall vs. Fisher Paykel Healthcare |
| Hansen Technologies vs. Aneka Tambang Tbk | Hansen Technologies vs. BHP Group Limited | Hansen Technologies vs. Commonwealth Bank | Hansen Technologies vs. Commonwealth Bank of |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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