Correlation Between Stockland and Argosy Property
Can any of the company-specific risk be diversified away by investing in both Stockland and Argosy 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 Stockland and Argosy Property into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Stockland and Argosy Property Limited, you can compare the effects of market volatilities on Stockland and Argosy 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 Stockland with a short position of Argosy Property. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stockland and Argosy Property.
Diversification Opportunities for Stockland and Argosy Property
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Stockland and Argosy is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Stockland and Argosy Property Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Argosy Property and Stockland 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 Stockland are associated (or correlated) with Argosy Property. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Argosy Property has no effect on the direction of Stockland i.e., Stockland and Argosy Property go up and down completely randomly.
Pair Corralation between Stockland and Argosy Property
Assuming the 90 days horizon Stockland is expected to generate 8.45 times more return on investment than Argosy Property. However, Stockland is 8.45 times more volatile than Argosy Property Limited. It trades about 0.03 of its potential returns per unit of risk. Argosy Property Limited is currently generating about 0.15 per unit of risk. If you would invest 320.00 in Stockland on November 3, 2024 and sell it today you would earn a total of 19.00 from holding Stockland or generate 5.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 96.88% |
| Values | Daily Returns |
Stockland vs. Argosy Property Limited
Performance |
| Timeline |
| Stockland |
| Argosy Property |
Stockland and Argosy Property Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Stockland and Argosy Property
The main advantage of trading using opposite Stockland and Argosy Property positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stockland position performs unexpectedly, Argosy 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 Argosy Property will offset losses from the drop in Argosy Property's long position.The idea behind Stockland and Argosy Property Limited pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Argosy Property vs. Barings BDC | Argosy Property vs. Gerdau SA ADR | Argosy Property vs. Tianjin Capital Environmental | Argosy Property vs. Insteel Industries |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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