Correlation Between Regal Funds and Cromwell Property
Can any of the company-specific risk be diversified away by investing in both Regal Funds and Cromwell 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 Regal Funds and Cromwell Property into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Regal Funds Management and Cromwell Property Group, you can compare the effects of market volatilities on Regal Funds and Cromwell 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 Regal Funds with a short position of Cromwell Property. Check out your portfolio center. Please also check ongoing floating volatility patterns of Regal Funds and Cromwell Property.
Diversification Opportunities for Regal Funds and Cromwell Property
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Regal and Cromwell is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Regal Funds Management and Cromwell Property Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cromwell Property and Regal Funds 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 Funds Management are associated (or correlated) with Cromwell Property. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cromwell Property has no effect on the direction of Regal Funds i.e., Regal Funds and Cromwell Property go up and down completely randomly.
Pair Corralation between Regal Funds and Cromwell Property
Assuming the 90 days trading horizon Regal Funds Management is expected to generate 0.95 times more return on investment than Cromwell Property. However, Regal Funds Management is 1.05 times less risky than Cromwell Property. It trades about 0.18 of its potential returns per unit of risk. Cromwell Property Group is currently generating about 0.01 per unit of risk. If you would invest 364.00 in Regal Funds Management on November 5, 2024 and sell it today you would earn a total of 24.00 from holding Regal Funds Management or generate 6.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Regal Funds Management vs. Cromwell Property Group
Performance |
| Timeline |
| Regal Funds Management |
| Cromwell Property |
Regal Funds and Cromwell Property Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Regal Funds and Cromwell Property
The main advantage of trading using opposite Regal Funds and Cromwell Property positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Regal Funds position performs unexpectedly, Cromwell 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 Cromwell Property will offset losses from the drop in Cromwell Property's long position.| Regal Funds vs. Sayona Mining | Regal Funds vs. Talisman Mining | Regal Funds vs. Hansen Technologies | Regal Funds vs. Andean Silver Limited |
| Cromwell Property vs. Djerriwarrh Investments | Cromwell Property vs. Aussie Broadband | Cromwell Property vs. Argo Investments | Cromwell Property vs. Auctus Alternative 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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