Correlation Between Dexus Convenience and Perseus Mining
Can any of the company-specific risk be diversified away by investing in both Dexus Convenience 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 Dexus Convenience and Perseus Mining 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 Perseus Mining, you can compare the effects of market volatilities on Dexus Convenience 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 Dexus Convenience with a short position of Perseus Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dexus Convenience and Perseus Mining.
Diversification Opportunities for Dexus Convenience and Perseus Mining
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between Dexus and Perseus is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Dexus Convenience Retail and Perseus Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Perseus Mining 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 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 Dexus Convenience i.e., Dexus Convenience and Perseus Mining go up and down completely randomly.
Pair Corralation between Dexus Convenience and Perseus Mining
Assuming the 90 days trading horizon Dexus Convenience Retail is expected to generate 0.54 times more return on investment than Perseus Mining. However, Dexus Convenience Retail is 1.86 times less risky than Perseus Mining. It trades about -0.06 of its potential returns per unit of risk. Perseus Mining is currently generating about -0.05 per unit of risk. If you would invest 286.00 in Dexus Convenience Retail on October 24, 2024 and sell it today you would lose (11.00) from holding Dexus Convenience Retail or give up 3.85% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dexus Convenience Retail vs. Perseus Mining
Performance |
| Timeline |
| Dexus Convenience Retail |
| Perseus Mining |
Dexus Convenience and Perseus Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dexus Convenience and Perseus Mining
The main advantage of trading using opposite Dexus Convenience and Perseus Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dexus Convenience 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.| Dexus Convenience vs. Scentre Group | Dexus Convenience vs. Vicinity Centres Re | Dexus Convenience vs. Charter Hall Retail | Dexus Convenience vs. Cromwell Property Group |
| Perseus Mining vs. Autosports Group | Perseus Mining vs. COAST ENTERTAINMENT HOLDINGS | Perseus Mining vs. Regal Funds Management | Perseus Mining vs. Microequities Asset Management |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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