Correlation Between Scentre and Hudson Investment
Can any of the company-specific risk be diversified away by investing in both Scentre and Hudson Investment 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 Scentre and Hudson Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Scentre Group and Hudson Investment Group, you can compare the effects of market volatilities on Scentre and Hudson Investment 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 Scentre with a short position of Hudson Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Scentre and Hudson Investment.
Diversification Opportunities for Scentre and Hudson Investment
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Scentre and Hudson is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Scentre Group and Hudson Investment Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hudson Investment and Scentre 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 Scentre Group are associated (or correlated) with Hudson Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hudson Investment has no effect on the direction of Scentre i.e., Scentre and Hudson Investment go up and down completely randomly.
Pair Corralation between Scentre and Hudson Investment
Assuming the 90 days trading horizon Scentre Group is expected to generate 0.74 times more return on investment than Hudson Investment. However, Scentre Group is 1.35 times less risky than Hudson Investment. It trades about 0.05 of its potential returns per unit of risk. Hudson Investment Group is currently generating about -0.05 per unit of risk. If you would invest 261.00 in Scentre Group on August 27, 2024 and sell it today you would earn a total of 93.00 from holding Scentre Group or generate 35.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Scentre Group vs. Hudson Investment Group
Performance |
| Timeline |
| Scentre Group |
| Hudson Investment |
Scentre and Hudson Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Scentre and Hudson Investment
The main advantage of trading using opposite Scentre and Hudson Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Scentre position performs unexpectedly, Hudson Investment 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 Hudson Investment will offset losses from the drop in Hudson Investment's long position.| Scentre vs. Cromwell Property Group | Scentre vs. GDI Property Group | Scentre vs. Australian Unity Office |
| Hudson Investment vs. Scentre Group | Hudson Investment vs. Vicinity Centres Re | Hudson Investment vs. Charter Hall Retail | Hudson Investment vs. Cromwell Property Group |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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