Correlation Between Charter Hall and Regal Investment
Can any of the company-specific risk be diversified away by investing in both Charter Hall and Regal Investment 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 Regal Investment 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 Regal Investment, you can compare the effects of market volatilities on Charter Hall and Regal Investment 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 Regal Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Charter Hall and Regal Investment.
Diversification Opportunities for Charter Hall and Regal Investment
-0.88 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Charter and Regal is -0.88. Overlapping area represents the amount of risk that can be diversified away by holding Charter Hall Retail and Regal Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Regal Investment 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 Regal Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Regal Investment has no effect on the direction of Charter Hall i.e., Charter Hall and Regal Investment go up and down completely randomly.
Pair Corralation between Charter Hall and Regal Investment
Assuming the 90 days trading horizon Charter Hall Retail is expected to generate 0.72 times more return on investment than Regal Investment. However, Charter Hall Retail is 1.39 times less risky than Regal Investment. It trades about 0.09 of its potential returns per unit of risk. Regal Investment is currently generating about -0.14 per unit of risk. If you would invest 337.00 in Charter Hall Retail on September 3, 2024 and sell it today you would earn a total of 6.00 from holding Charter Hall Retail or generate 1.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Charter Hall Retail vs. Regal Investment
Performance |
| Timeline |
| Charter Hall Retail |
| Regal Investment |
Charter Hall and Regal Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Charter Hall and Regal Investment
The main advantage of trading using opposite Charter Hall and Regal Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Charter Hall position performs unexpectedly, Regal Investment 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 Regal Investment will offset losses from the drop in Regal Investment's long position.| Charter Hall vs. GDI Property Group | Charter Hall vs. Champion Iron | Charter Hall vs. iShares Global Healthcare | Charter Hall vs. Peel Mining |
| Regal Investment vs. Champion Iron | Regal Investment vs. iShares Global Healthcare | Regal Investment vs. Peel Mining | Regal Investment vs. Australian Dairy Farms |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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