Correlation Between Hertz Global and Argosy Property
Can any of the company-specific risk be diversified away by investing in both Hertz Global and Argosy Property 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 Hertz Global and Argosy Property into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hertz Global Holdings and Argosy Property Limited, you can compare the effects of market volatilities on Hertz Global and Argosy Property 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 Hertz Global with a short position of Argosy Property. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hertz Global and Argosy Property.
Diversification Opportunities for Hertz Global and Argosy Property
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Hertz and Argosy is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Hertz Global Holdings and Argosy Property Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Argosy Property and Hertz Global 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 Hertz Global Holdings are associated (or correlated) with Argosy Property. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Argosy Property has no effect on the direction of Hertz Global i.e., Hertz Global and Argosy Property go up and down completely randomly.
Pair Corralation between Hertz Global and Argosy Property
Considering the 90-day investment horizon Hertz Global Holdings is expected to under-perform the Argosy Property. In addition to that, Hertz Global is 12.65 times more volatile than Argosy Property Limited. It trades about -0.05 of its total potential returns per unit of risk. Argosy Property Limited is currently generating about 0.15 per unit of volatility. If you would invest 60.00 in Argosy Property Limited on September 14, 2024 and sell it today you would earn a total of 9.00 from holding Argosy Property Limited or generate 15.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hertz Global Holdings vs. Argosy Property Limited
Performance |
| Timeline |
| Hertz Global Holdings |
| Argosy Property |
Hertz Global and Argosy Property Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hertz Global and Argosy Property
The main advantage of trading using opposite Hertz Global and Argosy Property positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hertz Global position performs unexpectedly, Argosy Property 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 Argosy Property will offset losses from the drop in Argosy Property's long position.| Hertz Global vs. United Rentals | Hertz Global vs. Ryder System | Hertz Global vs. Herc Holdings | Hertz Global vs. Hertz Global Hldgs |
| Argosy Property vs. Avient Corp | Argosy Property vs. Hertz Global Holdings | Argosy Property vs. Luxfer Holdings PLC | Argosy Property vs. Avis Budget 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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