Correlation Between Hammerson PLC and Growthpoint Properties
Can any of the company-specific risk be diversified away by investing in both Hammerson PLC and Growthpoint Properties 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 Hammerson PLC and Growthpoint Properties into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hammerson PLC and Growthpoint Properties, you can compare the effects of market volatilities on Hammerson PLC and Growthpoint Properties 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 Hammerson PLC with a short position of Growthpoint Properties. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hammerson PLC and Growthpoint Properties.
Diversification Opportunities for Hammerson PLC and Growthpoint Properties
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hammerson and Growthpoint is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Hammerson PLC and Growthpoint Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Growthpoint Properties and Hammerson PLC 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 Hammerson PLC are associated (or correlated) with Growthpoint Properties. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Growthpoint Properties has no effect on the direction of Hammerson PLC i.e., Hammerson PLC and Growthpoint Properties go up and down completely randomly.
Pair Corralation between Hammerson PLC and Growthpoint Properties
Assuming the 90 days trading horizon Hammerson PLC is expected to under-perform the Growthpoint Properties. In addition to that, Hammerson PLC is 1.03 times more volatile than Growthpoint Properties. It trades about -0.11 of its total potential returns per unit of risk. Growthpoint Properties is currently generating about 0.04 per unit of volatility. If you would invest 132,000 in Growthpoint Properties on September 12, 2024 and sell it today you would earn a total of 1,200 from holding Growthpoint Properties or generate 0.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hammerson PLC vs. Growthpoint Properties
Performance |
| Timeline |
| Hammerson PLC |
| Growthpoint Properties |
Hammerson PLC and Growthpoint Properties Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hammerson PLC and Growthpoint Properties
The main advantage of trading using opposite Hammerson PLC and Growthpoint Properties positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hammerson PLC position performs unexpectedly, Growthpoint Properties 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 Growthpoint Properties will offset losses from the drop in Growthpoint Properties' long position.| Hammerson PLC vs. Sasol Ltd Bee | Hammerson PLC vs. Centaur Bci Balanced | Hammerson PLC vs. Growthpoint Properties | Hammerson PLC vs. Coronation Global Equity |
| Growthpoint Properties vs. Brimstone Investment | Growthpoint Properties vs. Zeder Investments | Growthpoint Properties vs. Standard Bank Group | Growthpoint Properties vs. Deneb Investments |
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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