Correlation Between Regal Investment and Charter Hall
Can any of the company-specific risk be diversified away by investing in both Regal Investment and Charter Hall 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 Regal Investment and Charter Hall into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Regal Investment and Charter Hall Retail, you can compare the effects of market volatilities on Regal Investment and Charter Hall 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 Regal Investment with a short position of Charter Hall. Check out your portfolio center. Please also check ongoing floating volatility patterns of Regal Investment and Charter Hall.
Diversification Opportunities for Regal Investment and Charter Hall
-0.88 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Regal and Charter is -0.88. Overlapping area represents the amount of risk that can be diversified away by holding Regal Investment and Charter Hall Retail in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Charter Hall Retail and Regal Investment 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 Regal Investment are associated (or correlated) with Charter Hall. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Charter Hall Retail has no effect on the direction of Regal Investment i.e., Regal Investment and Charter Hall go up and down completely randomly.
Pair Corralation between Regal Investment and Charter Hall
Assuming the 90 days trading horizon Regal Investment is expected to under-perform the Charter Hall. In addition to that, Regal Investment is 1.39 times more volatile than Charter Hall Retail. It trades about -0.14 of its total potential returns per unit of risk. Charter Hall Retail is currently generating about 0.09 per unit of volatility. If you would invest 337.00 in Charter Hall Retail on September 3, 2024 and sell it today you would earn a total of 6.00 from holding Charter Hall Retail or generate 1.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Regal Investment vs. Charter Hall Retail
Performance |
| Timeline |
| Regal Investment |
| Charter Hall Retail |
Regal Investment and Charter Hall Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Regal Investment and Charter Hall
The main advantage of trading using opposite Regal Investment and Charter Hall positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Regal Investment position performs unexpectedly, Charter Hall 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 Charter Hall will offset losses from the drop in Charter Hall's long position.| Regal Investment vs. Champion Iron | Regal Investment vs. iShares Global Healthcare | Regal Investment vs. Peel Mining | Regal Investment vs. Australian Dairy Farms |
| Charter Hall vs. GDI Property Group | Charter Hall vs. Champion Iron | Charter Hall vs. iShares Global Healthcare | Charter Hall vs. Peel Mining |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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