Correlation Between Prime Financial and Dexus Convenience
Can any of the company-specific risk be diversified away by investing in both Prime Financial and Dexus Convenience 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 Prime Financial and Dexus Convenience into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Prime Financial Group and Dexus Convenience Retail, you can compare the effects of market volatilities on Prime Financial and Dexus Convenience 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 Prime Financial with a short position of Dexus Convenience. Check out your portfolio center. Please also check ongoing floating volatility patterns of Prime Financial and Dexus Convenience.
Diversification Opportunities for Prime Financial and Dexus Convenience
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Prime and Dexus is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Prime Financial Group and Dexus Convenience Retail in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dexus Convenience Retail and Prime Financial 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 Prime Financial Group are associated (or correlated) with Dexus Convenience. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dexus Convenience Retail has no effect on the direction of Prime Financial i.e., Prime Financial and Dexus Convenience go up and down completely randomly.
Pair Corralation between Prime Financial and Dexus Convenience
Assuming the 90 days trading horizon Prime Financial Group is expected to under-perform the Dexus Convenience. In addition to that, Prime Financial is 1.94 times more volatile than Dexus Convenience Retail. It trades about -0.09 of its total potential returns per unit of risk. Dexus Convenience Retail is currently generating about -0.05 per unit of volatility. If you would invest 299.00 in Dexus Convenience Retail on September 3, 2024 and sell it today you would lose (4.00) from holding Dexus Convenience Retail or give up 1.34% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Prime Financial Group vs. Dexus Convenience Retail
Performance |
| Timeline |
| Prime Financial Group |
| Dexus Convenience Retail |
Prime Financial and Dexus Convenience Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Prime Financial and Dexus Convenience
The main advantage of trading using opposite Prime Financial and Dexus Convenience positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Prime Financial position performs unexpectedly, Dexus Convenience 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 Dexus Convenience will offset losses from the drop in Dexus Convenience's long position.| Prime Financial vs. Audio Pixels Holdings | Prime Financial vs. Iodm | Prime Financial vs. Nsx | Prime Financial vs. TTG Fintech |
| Dexus Convenience vs. Seven West Media | Dexus Convenience vs. Carlton Investments | Dexus Convenience vs. Clime Investment Management | Dexus Convenience vs. Centaurus 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
Other Complementary Tools
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device |