Correlation Between GDI Property and Charter Hall
Can any of the company-specific risk be diversified away by investing in both GDI Property and Charter Hall 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 GDI Property and Charter Hall into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GDI Property Group and Charter Hall Retail, you can compare the effects of market volatilities on GDI Property and Charter Hall 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 GDI Property with a short position of Charter Hall. Check out your portfolio center. Please also check ongoing floating volatility patterns of GDI Property and Charter Hall.
Diversification Opportunities for GDI Property and Charter Hall
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between GDI and Charter is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding GDI Property Group and Charter Hall Retail in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Charter Hall Retail and GDI Property 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 GDI Property Group are associated (or correlated) with Charter Hall. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Charter Hall Retail has no effect on the direction of GDI Property i.e., GDI Property and Charter Hall go up and down completely randomly.
Pair Corralation between GDI Property and Charter Hall
Assuming the 90 days trading horizon GDI Property Group is expected to under-perform the Charter Hall. In addition to that, GDI Property is 1.09 times more volatile than Charter Hall Retail. It trades about -0.1 of its total potential returns per unit of risk. Charter Hall Retail is currently generating about -0.08 per unit of volatility. If you would invest 347.00 in Charter Hall Retail on October 31, 2024 and sell it today you would lose (24.00) from holding Charter Hall Retail or give up 6.92% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
GDI Property Group vs. Charter Hall Retail
Performance |
| Timeline |
| GDI Property Group |
| Charter Hall Retail |
GDI Property and Charter Hall Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GDI Property and Charter Hall
The main advantage of trading using opposite GDI Property and Charter Hall positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GDI Property position performs unexpectedly, Charter Hall 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 Charter Hall will offset losses from the drop in Charter Hall's long position.| GDI Property vs. Ainsworth Game Technology | GDI Property vs. G8 Education | GDI Property vs. WiseTech Global Limited | GDI Property vs. Beam Communications Holdings |
| Charter Hall vs. Alternative Investment Trust | Charter Hall vs. National Storage REIT | Charter Hall vs. Pinnacle Investment Management | Charter Hall vs. Hudson Investment Group |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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