Correlation Between Ingenia Communities and Energy Resources
Can any of the company-specific risk be diversified away by investing in both Ingenia Communities and Energy Resources 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 Ingenia Communities and Energy Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ingenia Communities Group and Energy Resources, you can compare the effects of market volatilities on Ingenia Communities and Energy Resources 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 Ingenia Communities with a short position of Energy Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ingenia Communities and Energy Resources.
Diversification Opportunities for Ingenia Communities and Energy Resources
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Ingenia and Energy is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Ingenia Communities Group and Energy Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Energy Resources and Ingenia Communities 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 Ingenia Communities Group are associated (or correlated) with Energy Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Energy Resources has no effect on the direction of Ingenia Communities i.e., Ingenia Communities and Energy Resources go up and down completely randomly.
Pair Corralation between Ingenia Communities and Energy Resources
Assuming the 90 days trading horizon Ingenia Communities is expected to generate 1.39 times less return on investment than Energy Resources. But when comparing it to its historical volatility, Ingenia Communities Group is 6.95 times less risky than Energy Resources. It trades about 0.27 of its potential returns per unit of risk. Energy Resources is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 0.30 in Energy Resources on November 18, 2024 and sell it today you would earn a total of 0.00 from holding Energy Resources or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ingenia Communities Group vs. Energy Resources
Performance |
| Timeline |
| Ingenia Communities |
| Energy Resources |
Ingenia Communities and Energy Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ingenia Communities and Energy Resources
The main advantage of trading using opposite Ingenia Communities and Energy Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ingenia Communities position performs unexpectedly, Energy Resources 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 Energy Resources will offset losses from the drop in Energy Resources' long position.| Ingenia Communities vs. Scentre Group | Ingenia Communities vs. Vicinity Centres Re | Ingenia Communities vs. Charter Hall Retail | Ingenia Communities vs. Cromwell Property Group |
| Energy Resources vs. Microequities Asset Management | Energy Resources vs. MFF Capital Investments | Energy Resources vs. Centaurus Metals | Energy Resources vs. Hammer Metals |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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