Correlation Between Charter Hall and Perseus Mining
Can any of the company-specific risk be diversified away by investing in both Charter Hall and Perseus 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 Perseus 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 Perseus Mining, you can compare the effects of market volatilities on Charter Hall and Perseus 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 Perseus Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Charter Hall and Perseus Mining.
Diversification Opportunities for Charter Hall and Perseus Mining
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Charter and Perseus is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Charter Hall Retail and Perseus Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Perseus 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 Perseus Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Perseus Mining has no effect on the direction of Charter Hall i.e., Charter Hall and Perseus Mining go up and down completely randomly.
Pair Corralation between Charter Hall and Perseus Mining
Assuming the 90 days trading horizon Charter Hall Retail is expected to generate 0.44 times more return on investment than Perseus Mining. However, Charter Hall Retail is 2.27 times less risky than Perseus Mining. It trades about -0.09 of its potential returns per unit of risk. Perseus Mining is currently generating about -0.17 per unit of risk. If you would invest 347.00 in Charter Hall Retail on August 25, 2024 and sell it today you would lose (7.00) from holding Charter Hall Retail or give up 2.02% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Charter Hall Retail vs. Perseus Mining
Performance |
| Timeline |
| Charter Hall Retail |
| Perseus Mining |
Charter Hall and Perseus Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Charter Hall and Perseus Mining
The main advantage of trading using opposite Charter Hall and Perseus Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Charter Hall position performs unexpectedly, Perseus 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 Perseus Mining will offset losses from the drop in Perseus 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 |
| Perseus Mining vs. Platinum Asia Investments | Perseus Mining vs. Collins Foods | Perseus Mining vs. Hudson Investment Group | Perseus Mining vs. Alternative Investment Trust |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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