Correlation Between Dexus Convenience and ANZ Group
Can any of the company-specific risk be diversified away by investing in both Dexus Convenience and ANZ Group 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 Dexus Convenience and ANZ Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dexus Convenience Retail and ANZ Group Holdings, you can compare the effects of market volatilities on Dexus Convenience and ANZ Group 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 Dexus Convenience with a short position of ANZ Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dexus Convenience and ANZ Group.
Diversification Opportunities for Dexus Convenience and ANZ Group
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Dexus and ANZ is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Dexus Convenience Retail and ANZ Group Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ANZ Group Holdings and Dexus Convenience 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 Dexus Convenience Retail are associated (or correlated) with ANZ Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ANZ Group Holdings has no effect on the direction of Dexus Convenience i.e., Dexus Convenience and ANZ Group go up and down completely randomly.
Pair Corralation between Dexus Convenience and ANZ Group
Assuming the 90 days trading horizon Dexus Convenience Retail is expected to under-perform the ANZ Group. In addition to that, Dexus Convenience is 2.54 times more volatile than ANZ Group Holdings. It trades about -0.1 of its total potential returns per unit of risk. ANZ Group Holdings is currently generating about -0.2 per unit of volatility. If you would invest 10,381 in ANZ Group Holdings on September 12, 2024 and sell it today you would lose (206.00) from holding ANZ Group Holdings or give up 1.98% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dexus Convenience Retail vs. ANZ Group Holdings
Performance |
| Timeline |
| Dexus Convenience Retail |
| ANZ Group Holdings |
Dexus Convenience and ANZ Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dexus Convenience and ANZ Group
The main advantage of trading using opposite Dexus Convenience and ANZ Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dexus Convenience position performs unexpectedly, ANZ Group 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 ANZ Group will offset losses from the drop in ANZ Group's long position.| Dexus Convenience vs. Charter Hall Retail | Dexus Convenience vs. GDI Property Group | Dexus Convenience vs. Australian Unity Office | Dexus Convenience vs. Ecofibre |
| ANZ Group vs. Argo Investments | ANZ Group vs. Charter Hall Retail | ANZ Group vs. Navigator Global Investments | ANZ Group vs. Regal Investment |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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