Correlation Between Kip McGrath and Centuria Industrial
Can any of the company-specific risk be diversified away by investing in both Kip McGrath and Centuria Industrial 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 Kip McGrath and Centuria Industrial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kip McGrath Education and Centuria Industrial Reit, you can compare the effects of market volatilities on Kip McGrath and Centuria Industrial 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 Kip McGrath with a short position of Centuria Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kip McGrath and Centuria Industrial.
Diversification Opportunities for Kip McGrath and Centuria Industrial
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Kip and Centuria is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Kip McGrath Education and Centuria Industrial Reit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Centuria Industrial Reit and Kip McGrath 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 Kip McGrath Education are associated (or correlated) with Centuria Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Centuria Industrial Reit has no effect on the direction of Kip McGrath i.e., Kip McGrath and Centuria Industrial go up and down completely randomly.
Pair Corralation between Kip McGrath and Centuria Industrial
Assuming the 90 days trading horizon Kip McGrath Education is expected to under-perform the Centuria Industrial. In addition to that, Kip McGrath is 3.44 times more volatile than Centuria Industrial Reit. It trades about -0.01 of its total potential returns per unit of risk. Centuria Industrial Reit is currently generating about 0.0 per unit of volatility. If you would invest 293.00 in Centuria Industrial Reit on October 12, 2024 and sell it today you would lose (10.00) from holding Centuria Industrial Reit or give up 3.41% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kip McGrath Education vs. Centuria Industrial Reit
Performance |
| Timeline |
| Kip McGrath Education |
| Centuria Industrial Reit |
Kip McGrath and Centuria Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kip McGrath and Centuria Industrial
The main advantage of trading using opposite Kip McGrath and Centuria Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kip McGrath position performs unexpectedly, Centuria Industrial 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 Centuria Industrial will offset losses from the drop in Centuria Industrial's long position.| Kip McGrath vs. Firstwave Cloud Technology | Kip McGrath vs. Hotel Property Investments | Kip McGrath vs. Computershare | Kip McGrath vs. Vulcan Steel |
| Centuria Industrial vs. Premier Investments | Centuria Industrial vs. FireFly Metals | Centuria Industrial vs. Sandon Capital Investments | Centuria Industrial vs. Mirrabooka 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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