Correlation Between Southern Hemisphere and Australian Unity
Can any of the company-specific risk be diversified away by investing in both Southern Hemisphere and Australian Unity 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 Southern Hemisphere and Australian Unity into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Southern Hemisphere Mining and Australian Unity Office, you can compare the effects of market volatilities on Southern Hemisphere and Australian Unity 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 Southern Hemisphere with a short position of Australian Unity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Southern Hemisphere and Australian Unity.
Diversification Opportunities for Southern Hemisphere and Australian Unity
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between Southern and Australian is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Southern Hemisphere Mining and Australian Unity Office in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Australian Unity Office and Southern Hemisphere 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 Southern Hemisphere Mining are associated (or correlated) with Australian Unity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Australian Unity Office has no effect on the direction of Southern Hemisphere i.e., Southern Hemisphere and Australian Unity go up and down completely randomly.
Pair Corralation between Southern Hemisphere and Australian Unity
Assuming the 90 days trading horizon Southern Hemisphere Mining is expected to generate 10.37 times more return on investment than Australian Unity. However, Southern Hemisphere is 10.37 times more volatile than Australian Unity Office. It trades about 0.09 of its potential returns per unit of risk. Australian Unity Office is currently generating about 0.0 per unit of risk. If you would invest 3.10 in Southern Hemisphere Mining on November 8, 2024 and sell it today you would earn a total of 0.30 from holding Southern Hemisphere Mining or generate 9.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Southern Hemisphere Mining vs. Australian Unity Office
Performance |
| Timeline |
| Southern Hemisphere |
| Australian Unity Office |
Southern Hemisphere and Australian Unity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Southern Hemisphere and Australian Unity
The main advantage of trading using opposite Southern Hemisphere and Australian Unity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Southern Hemisphere position performs unexpectedly, Australian Unity 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 Australian Unity will offset losses from the drop in Australian Unity's long position.| Southern Hemisphere vs. Argo Investments | Southern Hemisphere vs. Navigator Global Investments | Southern Hemisphere vs. Hudson Investment Group | Southern Hemisphere vs. Hutchison Telecommunications |
| Australian Unity vs. Scentre Group | Australian Unity vs. Vicinity Centres Re | Australian Unity vs. Charter Hall Retail | Australian Unity 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
Other Complementary Tools
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges |